Asian Markets Track Wall Street Higher

Asian stock markets are trading mostly higher on Thursday, following the broadly positive cues from Wall Street overnight, as traders now feel that interest rate concerns have been priced into the markets and are indulging in picking up stocks at reduced levels following recent weakness. Meanwhile, the renewed COVID-19 induced curbs in China weighed on market sentiment. Asian Markets closed mostly lower on Wednesday.

The release of the US Fed’s Beige Book, a compilation of anecdotal evidence on economic conditions in each of the twelve Fed districts, said economic activity in the U.S. has been essentially unchanged since early July.

Traders also await remarks by Fed Chair Jerome Powell later today, along with the European Central Bank’s monetary policy decision.

The Australian stock market is modestly higher on Thursday, recouping some of the losses in the previous two sessions, with the benchmark S&P/ASX 200 staying below the 6,800 level, following the broadly positive cues from Wall Street overnight, with gains across most sectors, led by technology and materials stocks, partially offset by weakness in energy stocks after crude oil prices tumbled.

The benchmark S&P/ASX 200 Index is gaining 81.70 points or 1.21 percent to 6,811.00, after touching a high of 6,818.10 earlier. The broader All Ordinaries Index is up 88.30 points or 1.27 percent to 7,047.60. Australian stocks ended sharply lower on Wednesday.

Among major miners, Mineral Resources is gaining almost 3 percent, OZ Minerals is up almost 2 percent, Rio Tinto is adding more than 1 percent, Fortescue Metals is advancing more than 2 percent and BHP Group is edging up 0.4 percent.

Oil stocks are mostly lower. Santos is losing more than 2 percent and Beach energy is declining almost 1 percent, while Origin Energy is edging up 0.5 percent. Woodside Energy is slipping more that 7 percent as it is trading ex-dividend.

In the tech space, Afterpay owner Block is gaining 3.5 percent, Xero is adding almost 3 percent, and Zip is advancing more than 4 percent, while WiseTech Global and Appen are up more than 2 percent each.

Among the big four banks, National Australia Bank and Commonwealth Bank are edging down 0.2 to 0.4 percent each, while Westpac is edging up 0.2 percent and ANZ Banking is gaining almost 1 percent.

Among gold miners, Resolute Mining is gaining more than 2 percent, Gold Road Resources is advancing more than 5 percent and Newcrest Mining is adding more than 1 percent, while Northern Star Resources and Evolution Mining are up more than 3 percent each.

In other news, shares in Tyro Payments skyrocket more that 29 percent after it rejected a $1.27 per share takeover bid from private equity group led by Potentia Capital.

Shares in Link Administration Holdings are surging more than 6 percent after the ACCC approved the financial software company’s $2.5 billion takeover by Canadian firm Dye & Durham.

In economic news, Australia posted a seasonally adjusted merchandise trade surplus of A$8.733 billion in July, the Australian Bureau of Statistics said on Thursday. That was well shy of expectations for a surplus of A$14.5 billion and down sharply from the downwardly revised A$17.13 billion surplus in June (originally A$17.67 billion). Exports were down 9.9 percent on month after rising 5.0 percent in the previous month, while imports jumped 5.0 percent on month after gaining just 1.0 percent a month earlier.

In the currency market, the Aussie dollar is trading at $0.672 on Thursday.

The Japanese stock market is sharply lower on Thursday, extending the losses in the previous session, with the Nikkei 225 just a tad below the 28,000 mark, following the broadly positive cues from Wall Street overnight, with gains across most sectors, led by exporters and technology stocks, even as the yen continues its plunge to a fresh 24-year lows.

The benchmark Nikkei 225 Index closed the morning session at 27,992.25, up 561.95 points or 2.05 percent, after touching a high of 28,006.09 earlier. Japanese stocks closed significantly lower on Wednesday.

Market heavyweight SoftBank Group is gaining more than 2 percent and Uniqlo operator Fast Retailing is adding more than 1 percent. Among automakers, Honda is edging up 0.2 percent and Toyota is gaining almost 2 percent.

In the tech space, Screen Holdings and Tokyo Electron are adding more than 2 percent each, while Advantest is gaining more than 1 percent.

In the banking sector, Mitsubishi UFJ Financial and Sumitomo Mitsui Financial are gaining almost 2 percent each, while Mizuho Financial is adding more than 2 percent.

Among the major exporters, Canon and Sony are gaining almost 2 percent each, while Mitsubishi Electric is adding more than 2 percent and Panasonic is advancing more than 3 percent.

Among the other major gainers, NTN is surging almost 6 percent, while Daiichi Sankyo and BANDAI NAMCO are gaining more than 4 percent each. Keyence, Sumitomo Pharma, Nippon Telegraph & Telephone, Olympus and Resona Holdings are adding almost 4 percent each, while Isetan Mitsukoshi, Takashimaya, Showa Denko K.K., Panasonic, Nitto Denko, Rakuten and Omron are all up more than 3 percent each.

Conversely, there are no major losers.

In economic news, Japan’s gross domestic product expanded an annualized 3.5 percent on year in the second quarter of 2022, the Cabinet Office said on Thursday, beating expectations for a gain of 2.9 percent and up from 0.1 percent in the previous three months. On a seasonally adjusted quarterly basis, GDP climbed 0.9 percent – again beating forecasts for 0.7 percent following the flat reading in the three months prior.

The value of overall bank lending in Japan was up 1.9 percent on year in August, the Bank of Japan said on Thursday, coming in at 587.929 trillion yen. That follows the downwardly revised 1.7 percent increase in July (originally 1.8 percent).

Japan posted a current account surplus of 229.0 billion yen in July, the Ministry of Finance said on Thursday, down 86.6 percent from a year ago. That was week shy of expectations for a surplus of 713.5 billion yen following the 132.4 billion yen deficit in June.

In the currency market, the U.S. dollar is trading in the lower 144 yen-range on Thursday.

Elsewhere in Asia, New Zealand, South Korea, Singapore, Malaysia, Taiwan and Indonesia are higher by between 0.2 and 0.9 percent each. Hong Kong is bucking the trend and is down 0.5 percent. China is relatively flat.

On Wall Street, stocks moved sharply higher over the course of the trading day on Wednesday, regaining ground following the notable downward move seen over the past several sessions. The major averages all showed strong moves to the upside, with the tech-heavy Nasdaq snapping a seven-session losing streak.

The major averages finished the session just off their best levels of the day. The Dow jumped 435.98 points or 1.4 percent to 31,581.28, the Nasdaq soared 246.99 points or 2.1 percent to 11,791.90 and the S&P 500 surged 71.68 points or 1.8 percent to 3,979.87.

Meanwhile, the major European markets turned in a mixed performance on the day. While the U.K.’s FTSE 100 Index slumped 0.9 percent, the French CAC 40 Index closed just above the unchanged line and the German DAX Index rose by 0.4 percent.

Crude oil prices fell sharply on Wednesday on concerns about the outlook for energy demand amid rising fears of a global recession. West Texas Intermediate Crude oil futures for October ended lower by $4.94 or 5.7 percent at $81.94 a barrel, the lowest settlement since January 11.

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