Asia report: Most markets fall on fresh inflation concerns

Asia-Pacific markets were mostly weaker by Monday's close as investors reacted to fresh inflation data from the region.

Singapore and Malaysia unveiled inflation reports that surpassed initial expectations during the day, contributing to market unease.

Anticipation was also building for Australia's February consumer price index, scheduled for release on Wednesday, and Tokyo's inflation figures, slated for Friday.

“Asian stock markets are trading with a mix of results, influenced by the global market trends from Friday,” said TickMill market analyst Patrick Munnelly.

“Some traders are considering taking profits from the recent market strength.”

Munnelly said there was also optimism about the future of interest rates after the Fed's recent monetary policy announcement.

“Although the exact timing of the first rate cut is still uncertain, there has been a resurgence in the likelihood of a quarter point rate cut in June.

“The Fed has upheld its projection for three interest rate cuts in the current year.”

Most markets in the red amid fresh inflation concerns

In Japan, the Nikkei 225 index observed a decline of 1.16%, settling at 40,414.12, while the Topix index dipped by 1.26%, closing at 2,777.64.

Leading the decliners on Tokyo’s benchmark was Sharp Corporation, down 6.79%, followed by Secom, off 5.24%, and Nexon Co, which lost 4.12%.

Similarly, Chinese markets experienced downturns, with the Shanghai Composite sliding by 0.71% to reach 3,026.31, and the Shenzhen Component decreasing by 1.49%, closing at 9,422.61.

Companies like Bomin Electronics and Hanma Technology Group were among the biggest losers in Shanghai, falling 10.04% and 10.03%, respectively.

In Hong Kong, the Hang Seng Index declined 0.16% to 16,473.64, with Lenovo Group down 8.63%, ENN Energy off 5.02%, and China Life Insurance closing 4.02% weaker.

South Korea's Kospi index also registered a modest decrease of 0.4%, ending the day at 2,737.57, with SK Square and KB Financial Group among the leading decliners, falling a respective 4.13% and 3.87%.

Contrastingly, Australia's S&P/ASX 200 index exhibited resilience, recording a gain of 0.53% to close at 7,811.90.

BSP Financial Group was up 4.96%, and Megaport added 3.9% by the end of trading in Sydney.

Across the Tasman Sea, New Zealand's S&P/NZX 50 index saw an uptick of 0.74%, reaching 12,067.03.

Notable performers in Wellington included KMD Brands and Heartland Group Holdings, rising 9.43% and 5.36%, respectively.

In currency markets, the dollar was last down 0.03% on the yen, trading at JPY 151.36.

The greenback meanwhile lost 0.25% against the Aussie to AUD 1.5310, while it retreated 0.2% from the Kiwi to change hands at NZD 1.6654.

On the oil front, Brent crude futures were last up 0.6% on ICE at $85.94 per barrel, while the NYMEX quote for West Texas Intermediate increased 0.64% to $81.15.

Inflation comes in hot in Singapore, Malaysia

In economic news, the Monetary Authority of Singapore reported that the country’s core consumer price index (CPI) jumped 3.6% year-on-year in February, surpassing January's 3.1% rise.

Economists polled by Reuters had expected a more modest 3.4% rise.

Core inflation, which excludes accommodation and private transport prices, serves as a crucial indicator of underlying inflationary pressures within an economy.

At the same time, headline inflation in February rose by 3.4% year-over-year, outperforming the 3.3% forecasted by economists.

Meanwhile, Malaysia observed a notable uptick in its headline inflation rate, marking the first increase since August 2022.

In February, the inflation rate climbed to 1.8%, up from 1.5% in January, defying expectations of a decrease to 1.4% as forecasted by economists polled by Reuters.

On a month-on-month basis, Malaysia's inflation rate saw a significant rise, reaching 0.5%, compared to 0.2% in January.

Reporting by Josh White for Sharecast.com.