Asian Stock Market: Tracks Wall Street losses, oil establishes below $85.00
|- Asian equities have slipped for the second day following weak trends in the US markets.
- China’s NBS see a pick-up in overall demand and core CPI sooner.
- BOJ’s worry about the depreciating yen has entrenched Nikkei225.
Markets in the Asian domain are displaying a vulnerable performance consecutively, following the footprints of Wall Street as US stocks are facing the sell-off amid soaring odds of a bumper rate hike by the Federal Reserve (Fed).
At the press time, Japan’s Nikkei225 drops 1.09%, ChinaA50 tumbles 1.36%, and Hang Seng eased 0.47%.
Chinese equities are witnessing an intense sell-off despite the positive commentary from the National Bureau of Statistics (NBS). The agency has cited that China's domestic demand is recovering slower than supply. It is difficult to justify whether demand is subdued or supply is gearing faster. However, the agency assures that demand will pick up at a decent pace and low core Consumer Price Index (CPI) will scale better.
Meanwhile, Japanese equities have turned volatile as the Bank of Japan (BOJ)’s warning of intervention in Fx moves has cleared that the depreciating yen is becoming a nightmare for the economy. Companies that are highly dependent on the import of inputs are facing currency risk and are failing to pass on the impact to the end consumers, which is forcing them to halt their operating activities.
The US dollar index (DXY) has recovered its morning losses ahead of the US Michigan Consumer Sentiment Index data. The sentiment data is seen higher at 60 against the prior release of 58.2.
On the oil front, oil prices have been established below $85.00 and are expecting more weakness as Energy Information Administration (EIA) is continuously displaying a build-up of oil inventories. This indicates declining oil demand in the US and soaring odds for a Fed’s bumper rate hike will trim demand further.
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