Australian stocks rose by more than 1%, while Hong Kong and South Korean markets were lower Monday. This was in spite of Australia’s central bank decisions this week.
The S&P/ASX 200 gained 1.11% to close the session at 6,612.6. Retail stocks and banking stocks were in the green.
Japan and mainland China markets were also higher.
The Nikkei225 in Japan lost 0.84% of its gains and closed at 26,153.81. Meanwhile, the Topix index rose 1.34% to 1,869.71.
China’s Shanghai Composite gained 0.53 percent to 3,405.43, while the Shenzhen Component climbed 1.29% up to 13,026.25.
Stocks in South Korea and Hong Kong were both down.
The Hang Seng index closed Friday and fell as much as 1.8% in the early hours of Monday trade. In the closing hours of trade, it was down 0.3%.
Stock-traded funds are included in the stock connection scheme linking Hong Kong and mainland China starting Monday.
South Korea’s Kospi was initially struggling for direction. It closed at 2,300.34 with a 0.22% drop, while the Kosdaq dropped 0.93% to 722.73.
The MSCI’s broadest index of Asia-Pacific shares, outside Japan, traded at 0.15% more.
Late afternoon trade in Southeast Asia saw Indonesia’s Jakarta Composite drop 2.37%.
Credit Suisse’s Asia-Pacific equity strategist Dan Fineman said that markets have correctly priced in the Fed hikes, but that there is a “very high chance of recession” and markets will not rally.
“I believe that the worst is over.” He said that we will likely be moving along the bottom, with a little more downside, but that the difficulties of the first part will not repeat themselves in the second.
According to company news, Shimao, a Chinese property developer, failed to pay the principal and interest on a $1 billion offshore bond. Other real estate companies also defaulted or missed interest payments.
Monday is a holiday in the United States.
Looking ahead, the results of a private survey about China’s services activities will be available later in the week. Also, South Korean inflation data, and several central bank decisions, will be available.
Last week, European stocks closed mixed on the first day in the second half of 2018. However, markets across the United States rallied. Inflation, rising interest rates, and recession were all concerns in the first half of 2022.
Oil and Currencies
The U.S. Dollar Index, which measures the greenback’s performance against a basket of peers, was at 105.061.
Richard Yetsenga (chief economist at ANZ), wrote Monday that the USD is strong despite the possibility of 75bp increases at its June-July meetings. However, we still believe that the dollar will weaken later in the year.
The Japanese yen traded at 135.44 dollars, rising from levels of 137 last week. After recovering from below $0.679, the Australian dollar traded at $0.6854.
In Asia’s afternoon trading, oil futures were unchanged. U.S. crude futures fell slightly to $108.39/barrel, while Brent crude futures rose fractionally to $111.72.
