Asia’s major markets notched up minor gains on Thursday but it was a day of cautious trading ahead of Friday’s US jobs data and amid the continuing gloomy global mood.
Japan’s Nikkei hit a two-week top amid jumps in energy and chip shares while Hong Kong’s Hang Seng was knocked back despite trimming earlier losses. China’s mainland markets remained closed for a holiday.
Tokyo’s Nikkei index extended its rebound from multi-month lows and ended 0.7% higher at 27,311.30, after reaching a high of 27,399.19, a level not seen since September 21.
The broader Topix rose 0.5% to 1,922.47, also gaining for a fourth day and touching a two-week peak of 1,930.47.
Also on AF: UN Powers Wary of Pacific Push for Nuclear Tests Legacy Help
Energy was the best performing Nikkei sector, up 1.24% amid a rise in crude oil prices to multi-week highs. Chip shares also had an outsized influence on the Nikkei’s gain, following a 0.94% rally in the US Philadelphia SE Semiconductor Index overnight.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.7%, marking its third straight day of gains. It is up 4.5% for the week after a staggering 13% drop in September.
Hong Kong shares slid after a sharp rally in the previous session, underperforming firmer Asian markets as investors focused on China’s economic growth prospects.
Trading was quiet as traders stayed on the sidelines ahead of Friday’s US jobs figures and with China closed for the week for a national holiday.
The Hang Seng Index dropped 0.42%, or 75.82 points, to 18,012.15.
Elsewhere across the region, most major stock markets rose with South Korea and Thailand rising the most at 1% and 0.9%, respectively.
Indian stocks gained with Mumbai’s signature Nifty 50 index up 0.45%, or 77.45 points, at 17,351.75.
Oil Surges on OPEC+ Output Cut
Globally, shares rose as the dollar eased ahead of jobs data from the US that could offer a steer on the outlook for interest rates, while oil prices surged after OPEC+ agreed to cut output.
The dollar, which has been on a seemingly unstoppable upward path this year, retreated on Thursday, feeding some risk appetite and boosting the commodities complex, where oil was holding around its highest in three weeks.
The MSCI All-World index of global shares was up 0.3% on the day, heading for a week-on week gain of 5.3%, its largest weekly increase since the week of March 18 this year. This is on the heels of September’s 9.7% decline.
Overnight, San Francisco Federal Reserve President Mary Daly underscored the US central bank’s commitment to curbing inflation with more interest rate hikes, although she also said the Fed will not simply barrel ahead if the economy starts to crack.
Complicating the near-term outlook further is next week’s data on US consumer inflation, which is expected to have slowed for a third month in September to 8.1%, still its highest since the mid-1980s.
“We’re in two environments right now and the market is trying to decide whether we are in an inflationary or recessionary one,” Justin Onuekwusi, head of EMEA retail investments at Legal & General Investment Management, said.
“What this means in the short-term is that good news is bad news as the Fed is seen putting its foot on the brakes harder if we get good data, and if we get weaker data it’s seen as a sign that Fed and other central banks will loosen [monetary policy] earlier,” he said.
Europe Stocks Bounce Back
Just as investors appeared to get some respite from a relentless march higher in energy costs – not least in Europe, where consumers are facing a doubling in their utility bills compared with last year – crude oil jumped for a fourth day.
The Organization of the Petroleum Exporting Countries and its partners, including Russia, have agreed to the deepest cut in production since the COVID-19 pandemic began, choking off supply to an already tight market.
Oil prices rose to their highest since mid-September. Brent crude futures were up 0.8% at $94.07 a barrel while US futures rose 0.6% to $88.31.
Meanwhile, in Europe, stocks bounced back after a dip in the previous session, with investors awaiting more economic data and minutes of the European Central Bank’s September meeting for clues on the pace and path of rate hikes.
The STOXX 600 index was up 0.5%, while S&P 500 futures fell 0.2%. Nasdaq futures dipped 0.1%, suggesting more modest losses at the opening bell later.
Key figures
Tokyo – Nikkei 225 > UP 0.70% at 27,311.30 (close)
Hong Kong – Hang Seng Index < DOWN 0.42% at 18,012.15 (close)
Shanghai – Composite <> CLOSED
London – FTSE 100 < DOWN 0.15% at 7,042.08 (0945 BST)
New York – Dow < DOWN 0.14% at 30,273.87 (Wednesday close)
- Reuters with additional editing by Sean O’Meara
Read more:
Thailand to Grow 3.5% as a Weak Baht Boosts Exports
Europe Beats China for World’s Top EV Growth Markets
