Asian Markets Mixed Amid Cautious Trades

Asian stock markets are mixed on Wednesday, following mixed cues overnight from Wall Street, as traders are refraining from making major moves ahead of the Federal Reserve’s latest monetary policy decision later today. Uncertainty about the pace of global economic rebound due to the continued surge in coronavirus cases in India and Japan are also weighing on the market. Asian markets closed mostly lower on Tuesday.

The Australian stock market is higher after recouping early losses on Wednesday, with the benchmark S&P/ASX 200 above the 7,000 mark near 14-month highs, on easing concerns of an earlier than expected interest rate hike after quarterly inflation data came in under expectations. Weakness in materials and gold miners are offset by gains in energy, financial and technology stocks.

The benchmark S&P/ASX 200 Index is gaining 27.40 points or 0.39 percent to 7,061.20, after hitting a low of 7,028.60 in early trades. The broader All Ordinaries Index is up 22.60 points or 0.31 percent to 7,318.10. Australian stocks ended marginally lower on Tuesday.

Among major miners, BHP Group and Rio Tinto are losing almost 1 percent, while Fortescue Metals is flat.

In the tech space, Appen is gaining more than 3 percent and WiseTech Global is adding more than 1 percent, while Afterpay is down more than 1 percent each.

Among the big four banks, ANZ Banking is flat, while National Australia Bank, Westpac and Commonwealth Bank are adding almost 1 percent each.

Westpac has agreed to settle a class action over life insurance launched by Shine Lawyers, with the bank agreeing to pay out up to $30 million over the lawsuit. The Federal Court has not yet approved the settlement.

Gold miners are lower after the gold prices tumbled. Evolution Mining and Northern Star Resources are losing almost 3 percent, Newcrest Mining is declining more than 2 percent and Resolute Mining is down almost 4 percent.

Oil stocks were higher after crude oil prices climbed. Oil Search is gaining almost 2 percent, while Woodside Petroleum and Santos are up more than 1 percent each.

In other news, the head of electronics retailing giant JB Hi-Fi Richard Murray will leave the company at the end of August to lead billionaire retailer Solomon Lew’s fashion empire Premier Investments. The stock is down 4 percent.

Shares in Mirvac are up almost 4 percent after the apartment and townhouse developer lifted its full-year earnings guidance by about 7 percent based on very strong residential sales in the March quarter.

The consortium of investors, led by the Pacific Equity Partners and Carlyle, have withdrawn the $2.8 billion non-binding offer to takeover superannuation admin firm Link after it was rejected in October. Link shares are down almost 4 percent.

Shares in Ansell are surging more than 6 percent after the protective equipment maker upped its 2021 guidance, saying it expects a stronger second half than the first, pushing earnings per share and sales forecast higher. The company reported a 61.3 percent jump in profits to US$106.5 million or A$136 million for the first half of 2021.

In economic news, consumer prices in Australia were up 0.6 percent on quarter in the first quarter of 2021, the Australian Bureau of Statistics said on Wednesday. That was the least in three quarters and shy of expectations for 0.9 percent, which would have been unchanged from the previous quarter. On a yearly basis, inflation gained 1.1 percent – also missing forecasts for 1.4 percent but still up from 0.9 percent in the previous three months. This was the highest reading since the first quarter of 2020.

The Reserve Bank of Australia’s trimmed mean was up 0.3 percent on quarter and 1.1 percent on year – slowing from 0.4 percent on quarter and 1.2 percent on year in the previous quarter. The RBA’s weighted mean rose 0.4 percent on quarter and 1.3 percent on year, slowing from 0.5 percent on quarter and 1.4 percent on year in the previous three months.

In the currency market, the Aussie dollar is trading at $0.774 on Wednesday.

The Japanese stock market is higher after recouping early losses on Wednesday, with the benchmark Nikkei index again breaking above the 29,000 mark, as traders digested better-than-expected retail sales data. Traders also await the Federal Reserve’s monetary policy statement later today. The cues overnight from Wall Street were mixed.

However, traders are worried about the restrictions in economic activity amid the strong fourth wave of coronavirus infections driven by more contagious variants. Reports suggest that people are not complying with the state of emergency, particularly in Tokyo, along with three western Japan prefectures of Osaka, Kyoto and Hyogo.

The benchmark Nikkei 225 Index closed the morning session at 29,102.34, up 110.45 points or 0.38 percent, after hitting a low of 28,875.91 in early trades. Japanese stocks closed lower on Tuesday.

Market heavyweight SoftBank Group is losing more than 1 percent, while Uniqlo operator Fast Retailing is up 0.5 percent. Among automakers, Honda and Toyota are gaining almost 1 percent.

In the tech space, Tokyo Electron is up more than 1 percent, while Advantest and Screen Holdings are gaining almost 2 percent each. In the banking sector, Sumitomo Mitsui Financial is gaining more than 1 percent and Mitsubishi UFJ Financial is adding almost 2 percent.

Among the major exporters, Panasonic is gaining more than 1 percent, Mitsubishi Electric is up almost 1 percent and Sony is adding more than 3 percent, while Canon is edging down 0.2 percent.

Among the other major gainers, Fuji Electric is soaring almost 12 percent, Fujikura is gaining almost 6 percent, Tokyu Fudosan is adding almost 5 percent and Osaka Gas is up 3.5 percent. Z Holdings, Hino Motors, Takashimaya and M3 are gaining more than 3 percent each. NTT is up almost 3 percent.

Conversely, Tokuyama is losing more than 7 percent and Kyocera is down more than 5 percent, while Nippon Yusen, Central Japan Railway and Okuma are declining more than 3 percent each.

In economic news, the value of retail sales in Japan was up 5.2 percent on year in March, the Ministry of Economy, Trade and Industry said on Wednesday – coming in at 13.498 trillion yen. That was the first growth in retail trade since November 2020 and the steepest pace in five months, beating expectations for an increase of 4.7 percent following the 1.5 percent decline in the previous month. On a monthly basis, retail sales climbed 1.2 percent after advancing 3.1 percent in February. For the first quarter of 2021, retail sales were up 0.5 percent on year and 0.4 percent on quarter at 37.228 trillion yen.

In the currency market, the U.S. dollar is trading in the higher 108 yen-range on Wednesday.

Elsewhere in Asia, New Zealand, Hong Kong, Singapore and Indonesia are higher by between 0.1 and 0.3 percent each, while China, Malaysia and Taiwan are lower by between 0.1 and 0.4 percent each. South Korea is down almost 1 percent.

On Wall Street, stocks showed a lack of direction over the course of the trading day on Tuesday with traders looking ahead to the Federal Reserve’s monetary policy announcement on Wednesday. The major averages spent the day bouncing back and forth across the unchanged line.

The tech-heavy Nasdaq posted a modest loss, slipping 48.56 points or 0.3 percent to 14,090.22, while the Dow and the S&P 500 closed nearly flat. The Dow inched up 3.36 points or less than a tenth of a percent to 33,984.93 and the S&P 500 edged down 0.90 points or less than a tenth of a percent to 4,186.72.

Meanwhile, the major European markets showed modest moves to the downside on the day. While the French CAC 40 Index closed just below the unchanged line, the U.K.’s FTSE 100 Index and the German DAX Index both slipped by 0.3 percent.

Crude oil prices moved higher on Tuesday as OPEC’s decision to gradually increase oil output helped offset concerns about energy demand. West Texas Intermediate Crude oil futures for June ended higher by $1.03 or 1.7 percent at $62.94 a barrel.

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