Indian Morning Briefing: Mixed Asian Markets; South Korea’s economic growth slows in first quarter

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GLOBAL MARKETS 
DJIA             34049.46    238.06     0.70% 
Nasdaq           13004.85    165.56     1.29% 
S&P 500           4296.12     24.34     0.57% 
FTSE 100          7380.54   -141.14    -1.88% 
Nikkei Stock     26726.50    135.72     0.51% 
Hang Seng        19967.43     98.09     0.49% 
Kospi             2668.67     11.54     0.43% 
SGX Nifty*       17095.00     100.0     0.59% 
*April contract 
 
USD/JPY    127.72-73  -0.32% 
Range      128.24   127.35 
EUR/USD    1.0730-33  +0.17% 
Range      1.0736   1.0707 
 
CBOT Wheat May $10.620 per bushel 
Spot Gold  $1901.48/oz 0.2% 
Nymex Crude (NY) $99.11 -$2.96 
 
 
US STOCKS 

US equities rose as government bond yields retreated and investors took the opportunity to buy beat tech stocks and other growth stocks.

The S&P 500 rose 0.6% in a volatile session. The Dow Jones Industrial Average gained 0.7% after suffering its worst session since October 2020 on Friday. The technology-focused Nasdaq Composite Index, which has underperformed other indexes this year, added 1.3%. Shares of Twitter rose 5.6% after the social media company accepted Elon Musk’s $44 billion takeover deal.

A drop in bond yields signaled to investors that the Federal Reserve might not raise interest rates as aggressively as expected, investors said.

“Rates had weighed against the market,” said Jack Ablin, chief investment officer of Cresset Capital. “Now we are seeing a reversal of that trend.”

Investors fear that the strict policies put in place by China to fight Covid-19 could further disrupt global supply chains.

 
 
ASIAN STOCKS 

Japanese equities were marginally higher, driven by gains in real estate and electronics stocks, as worries about borrowing costs eased. Financial stocks underperformed after US Treasury yields fell overnight. Profits were the focus. The Nikkei Stock Average was up 0.2% at 26,633.39.

South Korea’s Kospi rose 0.4% to 2667.28 in early trade, driven by gains in biotech and auto stocks. Growth stocks rose as some investors look for bargains after the benchmark’s losses for two consecutive sessions. The country’s GDP grew 0.7% quarter on quarter in 1Q, much weaker than in 4Q, but slightly stronger than market forecasts of 0.6% growth.

Hong Kong shares were higher in early trading as tech companies advanced, sending the benchmark Hang Seng Index up 1.2% to 20099.57. The Hang Seng TECH index was up 4.3% at 3967.95. Hong Kong shares rose amid a technical rebound, with the HSI index likely to hover around 20,000, KGI Securities analysts said in a note. They added that the technology sector was supported by the strong performance of the US ADR market overnight. Still, China’s quarantine measures could weigh on sentiment and limit gains, KGI analysts added.

Chinese stocks were higher in choppy morning trading after falling on Monday amid concerns over the Covid-19 outbreaks in China. The Shanghai Composite Index rose 0.2% to 2933.90, the Shenzhen Composite Index was flat at 2169.16, while the ChiNext Price Index gained 0.1% to 2170.35 . Sentiment could be weighed down in the short term, amid fears of a potential Beijing lockdown that could lead to more supply chain disruptions, exacerbate already runaway inflation and slow global growth, analyst Stephen Innes said. of SPI Asset Management, in a note. Bank stocks were higher.

 
FOREX 

The yen strengthened against the G-10 and Asian currencies during the Asian morning session amid concerns over the possibility of further Covid-19 shutdowns in China. Fears of a potential widening of lockdowns in Beijing rattled risky assets overnight, said CMC Markets analyst Tina Teng. Combined with the Russian-Ukrainian conflict, these blockages are causing major global supply chain problems, heightening fears of impending global economic stagflation, Teng added. USD/JPY slipped 0.5% to 127.53, AUD/JPY fell 0.4% to 91.62 and SGD/JPY fell 0.3% to 92.92.

 
METALS 

Gold rose at the start of Asian trade, reversing an overnight decline. The precious metal could remain in high demand as an inflation hedge and safe haven, buoyed by a continued rise in inflation as well as Russia’s war on Ukraine, Commerzbank analyst Carsten said. Fritsch in a note. “The simultaneous massive rise in bond yields (…) could not stop the rise in the price of gold, but only slowed it down,” the analyst said. Spot gold was up 0.2% at $1,901.48 an ounce.

 
OIL SUMMARY 

Oil prices were higher at the start of Asian trade, reversing declines overnight. WTI crude fell below $100 a barrel on Monday, while Brent settled around 4% lower. There are still concerns that Covid-19 outbreaks in China, the world’s biggest importer of crude, could weigh on demand, ANZ analysts said in a note. Beijing’s zero Covid policy could delay any recovery in demand, they said. EU-Russia relations also remain a focus after French President Macron called for more sanctions against Moscow, including a ban on oil and coal imports, SPI Asset Management analyst Stephen Innes said in a rating. First-month WTI and Brent both rose 0.3% to $98.82/bbl and $102.65/bbl, respectively.

 
 
TOP HEADLINES 
U.S. Stocks Finish Volatile Session With Gains 
Bank of Canada's Macklem Says Half-Point Rate Rise Will Be in Play in June Decision 
Senate Tees Up Votes on Biden's Fed Nominees 
South Korea's Economic Growth Decelerates in First Quarter 
The $67 Billion Tariff Dodge That's Undermining U.S. Trade Policy 
Countries Ramp Up Rules Regarding ESG Disclosure 
Chinese Markets Tank as Investors Worry About Covid-19 Lockdowns 
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Beijing Orders Citywide Covid-19 Testing as Fears of Lockdown Spark Panic-Buying 
Twitter and Elon Musk Strike $44 Billion Deal 
General Motors to Produce an Electric Corvette 
Whirlpool Says Appliance Demand Is Waning, as Costs Mount 
States Challenge Coin Dealer's 'Preemptive' Bankruptcy Filing 
Logistics Company Toll Reaches Settlement With Regulator Over Alleged Sanctions Violations 
Boeing Aims for Defense Buildup 
 
 

(END) Dow Jones Newswire

April 25, 2022 11:15 p.m. ET (03:15 GMT)

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

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