TOKYO – Asian benchmarks mostly slipped on Wednesday, as the region’s tech stocks echoed a similar drop in the sector on Wall Street.
The Japanese reference Nikkei 225 NIK,
little changed in morning exchanges. the Australian S & P / ASX 200 XJO,
plunged 0.3% while the South Korean Kospi 180721,
fell 1.4%. Hang Seng HSI from Hong Kong,
lost 0.9%, while the Shanghai Composite SHCOMP,
lost 0.8%. Singapore STI benchmarks,
and Indonesia JAKIDX,
Concerns continue over COVID-19, as reports of the more contagious omicron continue to grow in the region.
In Japan, many people are ignoring warnings to take precaution and crowds have come out at levels near pre-pandemic levels in Tokyo, where booster shots have barely started. Prime Minister Fumio Kishida has promised to speed them up, starting with health professionals.
“The region could continue to see an increase in the spread of the omicron virus to come, but recent manufacturing PMIs appear to be holding up for now. The risk may lie in further restraint measures, which could cloud the outlook for the services sector, as well as disruption of supply chains, ”said Yeap Jun Rong, market strategist at IG in Singapore, referring purchasing managers’ indices, an economic indicator for the manufacturing sector. and the service sectors.
A drop in tech stocks left the S&P 500 down slightly on Wall Street, even as the Dow Jones Industrial Average marked another all-time high.
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The S&P 500 SPX,
slipped 0.1% to 4,793.54, while the Nasdaq COMP composite,
fell 1.3% to 15,622.72 after a hectic day of trading. The Dow DJIA,
increased 0.6% to 36,799.65.
Over 65% of S&P 500 stocks rose. Still, the fall in tech stocks, which are the most weighted sector in the benchmark, left the S&P 500 in the red. Microsoft MSFT,
fell 1.7%, Apple AAPL,
slipped 1.3% and chipmaker Nvidia NVDA,
“Interest rate sensitive sectors are on the rise and these long-term growth sectors are on the decline today; not surprisingly, given the two-day move from the Treasury to 10 years, ”said Tom Hainlin, national investment strategist at US Bank Wealth Management. “You see investors factor in fairly strong growth in inflation expectations going forward, or at least 2022.”
Stocks got off to a good start to 2022 on Monday, with the S&P 500 and the Dow reaching new highs. A mix of economic data and quarterly corporate earnings reports should give investors a glimpse of the impact of the coronavirus pandemic and the persistent rise in inflation on businesses and consumers.
The job market will be a priority for investors, starting with the Labor Ministry’s employment report for December, which will be released on Friday. On Tuesday, the agency’s monthly survey of job openings and workforce turnover showed that a record 4.5 million American workers left their jobs in November, a sign confidence and further proof that the U.S. labor market is rebounding strongly from last year’s coronavirus recession.
“The markets are going to try to watch throughout the year,” said Brad McMillan, director of investments for Commonwealth Financial Network. “Right now, the markets are cautiously confident. “
OPEC and allied oil-producing countries plan to stick to their roadmap to slowly reinstate production cuts made during the height of the pandemic, including adding 400,000 barrels a day in February.
Some sectors of the economy are still struggling, especially with supply chain issues. Manufacturing sector growth slowed in December to an 11-month low, according to the Institute for Supply Management, a professional group of purchasing managers. The organization will release its December report for the services sector on Thursday.
Investors are also awaiting the minutes of the Federal Reserve’s last policy meeting in December, due for release on Wednesday.
“The big question is how concerned the Fed is about inflation,” McMillan said. “We’re really close to seeing how the Fed plays out and the minutes will be instructive on that.”
In energy trading, the American benchmark CLG22,
fell 23 cents to $ 76.76 a barrel in electronic trading on the New York Mercantile Exchange. It gained 91 cents to $ 76.99 a barrel on Tuesday. Brent crude BRNH22,
the international standard, fell 28 cents to $ 79.72 a barrel.
In currency trading, the US dollar USDJPY,
edged down to 116.04 Japanese yen from 116.16 yen. The recent range of the dollar against the yen is at its highest in five years, and a cheaper yen may be an advantage for giant exporters in Japan.