Indian morning briefing: Asian markets stir after Wall Street drop

GLOBAL MARKETS 
DJIA              33553.83    -39.09    -0.12% 
Nasdaq            11183.66   -174.75    -1.54% 
S&P 500            3958.79    -32.94    -0.83% 
FTSE 100           7351.19    -18.25    -0.25% 
Nikkei Stock      27975.18    -53.12    -0.19% 
Hang Seng         17817.36   -439.12    -2.41% 
Kospi              2457.39    -20.06    -0.81% 
SGX Nifty*        18407.50     -72.5    -0.39% 
*Nov contract 
 
USD/JPY    139.53-54  -0.01% 
Range      139.66   139.24 
EUR/USD    1.0372-75  -0.21% 
Range      1.0401   1.0363 
 
CBOT Wheat Dec $8.174 per bushel 
Spot Gold  $1,768.71/oz  -0.3% 
Nymex Crude (NY) $85.49 -$1.43 
 
 
US STOCKS 

US equities fell as a better-than-expected retail sales reading kept markets focused on the Federal Reserve.

The S&P 500 fell 0.8%, while the technology-focused Nasdaq Composite Index fell 1.5%. The Dow Jones Industrial Average lost 0.1%.

Investors are looking to ascertain the resilience of both consumers and businesses to pricing pressures and high borrowing costs. Data showed that US retail sales rose strongly in October. Quarterly updates from US retailers offered a more mixed picture.

“Part of the relative strength of retail sales versus some of the reported earnings is that it’s not an inflation-adjusted series,” said Ian Lyngen, head of US rates strategy at BMO Capital Markets. “Yes, prices are higher and that’s creating higher nominal sales. But in real terms, it’s not as strong as the headlines might suggest.”

 
 
ASIAN STOCKS 

Japanese stocks were lower in early trading, following declines on Wall Street overnight following stronger-than-expected retail sales data. Oil company Idemitsu Kosan fell 0.3% after it outlined its plan to invest 190 billion yen in clean energy projects. Average Nikkei stock fell 0.2% to 27976.84.

South Korea’s benchmark Kospi fell 0.4% to 2466.83 in early trading, following Wall Street’s declines overnight. Electronics and chemicals stocks led the Kospi’s retreat after US semiconductor stocks fell sharply. A better-than-expected US retail sales reading fueled inflation worries again and worries about aggressive Fed tightening, sending USD/KRW up 0.5% to 1332.20.

Chinese shares fell in early trading amid concerns over the rising number of Covid-19 cases in the country. The benchmark Shanghai Composite Index fell 0.5% to 3105.41, the Shenzhen Composite Index fell 0.5% to 2028.81 and the ChiNext Price Index fell 0.8% to 2384.20 . China’s property market could remain the focus after data showed home prices fell for the 14th consecutive month in October on continued weakness in real estate demand, analysts from China said in a note. Commerzbank. “The weak economy, sluggish employment and poor income prospects due to the domestic pandemic situation all have a part to play,” they said.

Hong Kong’s Hang Seng Index fell 1.7% to 17950.33, following a drop in US stocks overnight. Wall Street stocks fell as investors reviewed stronger-than-expected retail sales data and comments from the Federal Reserve that UOB analysts are likely to back expectations that a break in the squeeze is out of the question.

FOREX 

Most Asian currencies weakened against the US dollar in the Asian morning session on fears of a US recession. There are concerns about further Fed rate hikes leading to a recession, Philip Wee, senior forex strategist at DBS Group Research, said in a report, noting comments from Fed officials overnight who dismissed the dovish bets. With Fed rate hikes perceived as a recession risk, the incentive to keep selling US dollars has diminished, Wee added. USD/KRW was up 0.3% to 1341.34 and USD/SGD gained 0.2% to 1.3733, while AUD/USD fell 0.3% to 0.6715.

METALS 

Gold prices fell slightly in early Asian trade after stabilizing lower overnight as investors continued to look for clues about the Federal Reserve’s interest rate path after stronger-than-expected retail sales data. The precious metal appears to be stuck in limbo as weakening USD trade appears to be ready for a break, Oanda senior market analyst Edward Moya said in a note. “Right now its main catalyst is the Fed’s rate hike path, which determines the direction of the dollar,” he added. Spot gold fell 0.3% to $1,768.71/ounce.

OIL SUMMARY 

Oil prices were lower in early Asian trade as the potential risk to crude supplies posed by tensions over a missile attack in Poland eased somewhat. Now, demand concerns are likely to return to the fore as Covid-19 cases in China continue to rise and flu season approaches, Stephen Innes, managing partner at SPI Asset Management, said in a statement. “Traders are being left with little scope to recalibrate positions reflecting the possibility of further lockdowns in densely populated centers hurting oil demand exponentially more than other areas of the economy,” he added. First month WTI futures fell 0.5% to $85.13/bbl; First month Brent fell by 0.4% to 92.47 $/bbl.

 
 
TOP HEADLINES 
Fed Official Warns Against Prematurely Concluding Inflation Has Peaked 
Republicans Win Control of House 
Japan Exports Log 20th Straight Month of Growth in October 
Missile Blast in Poland Risked Russia-NATO Clash Before Both Sides Dialed Back 
McConnell Wins Re-Election as Senate Minority Leader 
Karen Bass Is Elected Mayor of Los Angeles 
Many Republican Lawmakers Are Wary of New Trump Presidential Bid 
Iran Hands Out More Death Sentences to Protesters 
Chip Maker Nvidia Issues Tepid Earnings Forecast as Videogaming Business Slows 
Cisco's Stock Rises on Strong Quarterly Sales and Guidance, But a Restructuring Is Coming 
FTX Management, Bahamas Gear Up for Fight Over Control of Bankruptcy 
Temasek to Write Down $275 Million Investment in Crypto Firm FTX 
Top CBS Executives Exit Amid Broader Paramount Restructuring 
Amazon Confirms Corporate Cuts That Could Hit 10,000 Employees 
Some Apple iPhones Won't Be Delivered Before Christmas 
Musk Tells Twitter Staff to Work 'Long Hours at High Intensity' or Leave 
 
 

(END) Dow Jones Newswires

November 16, 2022 at 10:15 PM ET (03:15 GMT)

Copyright (c) 2022 Dow Jones & Company, Inc.

Leave a Reply

%d bloggers like this: