Asia report: Most markets fall as investors watch Russia, oil
Most stock markets in Asia closed further into negative territory on Wednesday, as investors kept an eye on oil markets while digesting the latest inflation data out of China.
In Japan, the Nikkei 225 was down 0.3% at 24,717.53, as the yen weakened 0.2% against the dollar to last trade at JPY 115.90.
Technology conglomerate SoftBank Group jumped 3.62%, while the benchmark’s other major components suffered, with automation specialist Fanuc down 1.13% and fashion firm Fast Retailing losing 0.66%.
The broader Topix index slipped 0.06% by the end of trading in Tokyo, to close at 1,758.89.
On the mainland, the Shanghai Composite lost 1.13% to 3,256.39, and the smaller, technology-heavy Shenzhen Composite was off 1.1% at 2,116.15.
Fresh data out of Beijing showed input costs rising just above expectations in February, with the official producer price index up 8.8% year-on-year.
That was just ahead of Reuters-polled expectations for growth of 8.7%, but was a slowdown from the 9.1% gain seen in January.
Consumer prices, meanwhile, matched market forecasts, with the consumer price index up 0.9% year-on-year in February - in line with both January’s data and the estimate pencilled in by Reuters polling.
South Korea’s markets were closed for that country’s presidential election, while the Hang Seng Index in Hong Kong was down 0.67% at 20,627.71.
Oil prices were once again in focus, having rocketed before sunrise in the region after US president Joe Biden and UK prime minister Boris Johnson both announced blockades on Russian oil imports.
That news sent the price of the thick black stuff back above $130 per barrel, even though the UK’s plan was for a weaning-off of Russian sources by the end of the year.
Prices had pulled back slightly by the end of the Asian day, with Brent futures last down 1.9% on ICE at $125.55 per barrel, and West Texas Intermediate falling 2.5% to $120.66.
Responding to the US-UK blockades, Russian president Vladimir Putin signed a decree banning exports of unspecified commodities from his country, giving lawmakers time to decide the list of products and countries to be affected.
Walid Koudmani, chief market analyst at XTB, said investors were now waiting for an announcement “within days” to determine the potential impact on markets.
“Furthermore, a growing number of companies have announced their withdrawal from or suspension of services in Russia with McDonald's, Starbucks and Coca-Cola being the latest to make such announcements and isolating the country economically even more,” Koudmani said.
“While this rebound may encourage investors and increase confidence in the market, it is essential to keep in mind that any major news related to the ongoing conflict could have wide repercussions and may shake the extremely fragile market sentiment.”
Australasian markets went against the regional trend, with Australia’s S&P/ASX 200 rising 1.04% to 7,053.00, and New Zealand’s S&P/NZX 50 managing gains of 0.34% to 11,785.13.
The down under dollars were both stronger on the greenback, with the Aussie last ahead 0.73% at AUD 1.3653, and the Kiwi advancing 0.55% to NZD 1.4613.