Moving markets today: Asia markets mixed as Wall Street rally wanes, oil prices surge; All eyes on US producer prices and retail sales data
US stocks closed with losses driven by declines in major tech companies, despite strong performances in the energy and materials sectors. Oil prices continued to rise after Ukraine intensified drone strikes on Russian oil refineries, aiming to weaken the Russian economy further. The US House of Representatives passed a bill requiring ByteDance to sell TikTok’s US assets or face a ban. Market focus shifted to upcoming economic data releases including US retail sales, the producer prices index (PPI) report, and jobless claims, expected to provide insights into the economy’s pace. In corporate news, Vistry, Savills, and Moonpig Group are due to report earnings in the UK, while Adobe and Dollar General will do so in the US. Here are five key takeaways for your day.
UK housing market shows resilience in February: RICS
Britain’s housing market improved in February according to a recent industry survey, but uncertainty over the Bank of England’s interest rates may dampen demand. The Royal Institution of Chartered Surveyors (RICS) reported stable new buyer inquiries at +6, matching January’s figure after revision, marking one of the strongest readings since February 2022, Reuters reported. House prices, while still negative, rose to their highest level since October 2022 at -10%, up from -18% in January.
Bill passed by US house pressures Bytedance to divest Tiktok or face ban
The US House of Representatives has overwhelmingly passed a bill that puts pressure on ByteDance, the Chinese owner of TikTok, to sell off the app’s US assets within six months or face a ban. This action marks a significant threat to TikTok, reminiscent of challenges it faced during the Trump administration. The bipartisan vote, 352-65, underscores strong support in the House. However, the bill’s fate in the Senate is uncertain, as some senators prefer alternative approaches to regulating foreign-owned apps for security reasons. Senate Majority Leader Chuck Schumer has indicated that the Senate will carefully review the legislation.
US inventory data, Russian refinery attacks drive oil price surge
Oil prices continued to rise in Asian trading following a surprising drop in U.S. crude stockpiles, indicating a stronger demand for oil. Additionally, concerns about potential disruptions in supply due to Ukrainian attacks on Russian refineries supported the upward trend in prices. Brent futures saw a slight increase of 0.12 per cent to $84.13 per barrel, while U.S. West Texas Intermediate (WTI) crude rose by 0.9 per cent to $79.79 per barrel. These gains came after both contracts had already climbed around 3 per cent to hit a four-month high on Wednesday, boosted by positive outlooks for U.S. demand and heightened geopolitical risks, Reuters reported.
What’s coming up
Investors are keeping a close eye on various economic indicators like U.S. retail sales, the producer prices index (PPI), and jobless claims to gauge the pace of economic slowdown. Meanwhile, companies such as Vistry, Savills, and Moonpig Group will be sharing their financial results in the UK, while Adobe and Dollar General will do so in the US.
On Friday, Japan’s preliminary results from spring wage negotiations will be unveiled, with initial reports suggesting that several major companies have agreed to fully comply with union requests for salary hikes. This will be key in determining the timing of the Bank of Japan’s years-long ultra-loose stimulus exit.
Asia markets mixed as Wall Street rally loses steam
On Wednesday, the S&P 500 experienced a slight 0.2 per cent dip, with slightly more than half of its constituent stocks seeing gains. The Nasdaq Composite index fell by 0.5 percent, with only Amazon and Alphabet managing to post gains among the notable tech giants. Meanwhile, the Russell 2000, which focuses on small-cap stocks, saw a modest increase of 0.3 percent.
In the Asia-Pacific region, Australia’s S&P/ASX 200 index experienced a slight 0.18 per cent decline, while South Korea’s Kospi Composite index rose by a notable 0.61 per cent. Hong Kong’s Hang Seng index dropped by 0.12 per cent, while on the Chinese mainland, both the Shanghai Composite and the Shenzhen Composite indices saw increases of 0.29 per cent and 0.16 per cent, respectively. Japan’s Nikkei 225 index fell by 0.25 per cent.
Meanwhile, the dollar index remained relatively stable, hovering around 102.84. Spot gold prices showed minimal movement, holding steady at $2,173.11 per ounce.