March 23, 2023

Asia Markets Rally After Wall Street Bounces

On Wednesday, shares in Asia-Pacific markets jumped, as US stocks also saw a bounce in overnight trading.

Indexes rise

There was a 2.67% increase in the Nikkei 225 index in Japan, which closed the day at 27,680.26, as Tokyo Electron climbed 4.88% and a 2.59% gain was seen in Fast Retailing. There was also a 2.29% gain for the Topix index, which took it to 1,946.44.

The Hang Seng index in Hong Kong was trading higher by 2% briefly and recorded a 1.5% gain in the final trading hour. There was also a 1.26% increase in the Hang Seng Tech index. Meituan rose by 3.91%, while a 2.1% gain was seen in Tencent.

There was also a 0.67% rise in the Kospi index in South Korea, which took it to 2,386.85, and a 1.07% rise in Kosdaq took it to 790.72. A 1.65% gain in the Australian S&P/ASX 200 index was also recorded, which ended the day at 6,759.2.

On Wednesday, Philip Lowe, the Governor of the Reserve Bank of Australia, said that inflation numbers for June, which are scheduled for release in the next week, would be higher, and they need to bring it down to 2% to 3%. The March quarter saw a 5.1% increase in prices.

Mainland Chinese markets were also trading higher. A 0.77% gain was recorded in the Shanghai Composite, which reached 3,304.72 and a 0.63% gain in the Shenzhen Component pushed it to 12,573.12. On Wednesday, China did not change its prime rates for one and five years, as they remained 3.7% and 4.45%, respectively.

There was a 1.21% rise in the MSCI’s index of Asia-Pacific shares except for Japan.

US rally

After strong earnings reports, there was a rally in US stocks. A 2.43% gain was recorded in the Dow Jones Industrial Average, which rose by 754.44 points to reach 31,827.05. The S&P 500 saw gains of 2.76% which drove it to 3,936.69 and a 3.11% gain in the Nasdaq saw it hit 11,713.15.

Other positive news showed that Ukraine and Russia could make a deal that would put an end to the grain export blockade. Plus, the Nord Stream 1 pipeline was also set to resume gas exports according to schedule. However, the uncertainty of these events of corporate earnings and the Fed’s rate hike could make it a short-term bounce.

Currencies and oil

The US dollar index had fallen sharply but ended the day at 106.503. The Japanese yen got stronger against the dollar to trade at 138.13, better than last week’s levels. The Australian dollar also strengthened from levels this week to trade at $0.6919.

On Wednesday, the Indian rupee climbed from its record low on Tuesday to trade at 79.95 against the dollar. Meanwhile, Bitcoin was also gaining ground, as it hit $23,664.41.

There was a 1.34% fall in US crude futures, as they reached $102.82 per barrel, while a 1.14% drop was seen in Brent crude and this took it to $106.13 a barrel. The previous session had seen them rise by 1%.

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