Wall St gains fail to ignite Asian markets
Markets appeared to welcome the Fed’s attempt to fight surging inflation by raising its key interest rate and efforts to mediate a settlement to Russia's attack; Shanghai, Hong Kong, Seoul, Singapore gained, while Sydney, New Zealand and Jakarta retreated; Japanese markets closed for a holiday
image for illustrative purpose
Beijing: Asian stock markets were mixed on Monday after Wall Street turned in its biggest weekly gain in 16 months as investors watched efforts to negotiate an end to Russia's war on Ukraine.
Regional heavyweights Shanghai and Hong Kong gained. Seoul and Sydney retreated. Japanese markets were closed for a holiday. Wall Street's S&P 500 index rose 1.2% on Friday after markets appeared to welcome the Federal Reserve's attempt to fight surging inflation by raising its key interest rate. Investors watched efforts to mediate a settlement to Russia's attack, which has pushed up oil prices and added to uncertainty about the global economic outlook.
"It appears that there is a 50-50 chance of continuing with the pick-up in market sentiments," said Tan Boon Heng of Mizuho Bank in a report. The Shanghai Composite Index gained 0.2% to 3,257.05 and the Hang Seng in Hong Kong added 0.3% to 21,482.07. The Kospi in Seoul advanced 0.4% to 2,697.58 and Sydney's ASX-S&P 200 lost 0.2% to 7,283.50. New Zealand and Jakarta retreated while Singapore gained. The S&P rose to 4,463.12, adding to a streak that included two days of 2% gains. The Dow advanced 0.8% to 34,754.93 and the Nasdaq composite added 2% to 13,893.84. The three indexes had their best week since November 2020.
Russia's attack has added to investor unease about the Fed and other central banks withdrawing stimulus that has pushed up share prices and tighter Chinese curbs on business and travel in response to corona virus outbreaks. Last week, Fed Chair Jerome Powell expressed confidence the economy is strong enough to withstand higher interest rates. On Sunday, Turkey's foreign minister, Mevlut Cavusoglu, said Ukraine and Russia are close to an agreement on fundamental issues after he travelled to both countries to meet his counterparts. Cavusoglu said in return for its neutrality, Ukraine wants Turkey, Germany and the five permanent members of the UN Security Council to act as guarantors. Also Monday, Disney Co closed its Shanghai theme park as the city tried to control its biggest corona virus flare up in two years.
The southern business centre of Shenzhen allowed shops and offices to reopen after a weeklong closure. China's case numbers in its latest infection wave are low compared with other major countries, but authorities are enforcing a zero tolerance strategy that has suspended access to some major cities.
