Hang Seng Index, ASX 200, Nikkei Index: China Trade and the Yen in Focus

Bob Mason
Updated: May 8, 2024, 22:08 GMT+00:00

Key Points:

  • The Hang Seng Index declined for the second successive session on Wednesday (May 8), with the Nikkei Index suffering a heavy loss.
  • On Thursday (May 9), corporate earnings and trade data from China will warrant investor attention.
  • Wage growth figures from Japan and the Bank of Japan Summary of Opinions also need consideration.
Hang Seng Index, ASX 200, Nikkei Index

In this article:

US Equity Markets: Fed Speakers Influence Market Sentiment

On Wednesday (May 8), FOMC member commentary attracted investor attention. FOMC member Susan Collins was in focus, discussing the US economy and inflation. The Boston Fed President warned the economy needed to cool down to bring inflation to the 2% target. Collins favored a higher-for-longer Fed rate path to gain confidence in taming inflation.

On Wednesday (May 8), the Dow advanced by 0.44%. The Nasdaq Composite Index declined by 0.18%, while the S&P 500 ended the session flat.

Concerns about the Fed rate path and US equity market moves from Wednesday will likely set the tone for the Thursday (May 9) Asian session.

Asian Economic Calendar: Trade Data from China and Corporate Earnings on Focus

On Thursday (May 9), wage growth figures from Japan and the Bank of Japan Summary of Opinions will draw investor interest. Softer-than-expected wage growth numbers could reduce investor bets on a near-term Bank of Japan rate hike. Economists forecast average cash earnings to increase 1.5% year-on-year in March after rising 1.8% in February.

Nonetheless, the numbers may have less impact than usual. Wage negotiations ended in March, with sizeable wage hikes likely affecting the April stats.

However, the Bank of Japan Summary of Opinions could influence the Japanese Yen and the Nikkei.

Later in the Asian session, trade data from China will warrant investor attention. Improving trade terms could drive buyer demand for riskier assets. Economists predict exports to increase 1.0% year-on-year in April after falling 7.5% in March. Moreover, economists expect imports to advance 5.4% year-on-year after falling 1.9% in March.

Other stats include finalized Australian building permit figures. However, barring a marked revision to the preliminary building permit numbers, these will likely play second fiddle to the trade data.

Beyond the economic calendar, corporate earnings will remain the focal point. Softbank Corp. (9434), Daikin Industries (2914), Panasonic (6752), and Nissan Motor (7201) earnings results from Japan will influence buyer demand for Nikkei Index-listed stocks.

Commodities: Crude Oil, Gold, and Iron Ore

On Wednesday (May 8), gold spot (XAU/USD) declined by 0.23% to close the session at $2,308.85. WTI crude oil advanced by 0.78%, ending the Wednesday session at $78.99.

On the Singapore Futures Exchange, iron ore prices were up 1.43% on Thursday (May 9). Iron ore spot declined by 1.20% on Wednesday (May 8).

The USD/JPY and the Nikkei

The USD/JPY increased by 0.51% on Wednesday (May 8), closing the session at 155.481. Upward trends in the USD/JPY could fuel buyer demand for Nikkei Index-listed export stocks. However, the weaker Yen could fuel speculation about a government intervention to bolster the Yen. The threat of an intervention could impact Nikkei Index-listed export stocks.

The Futures Markets

On Thursday (May 8), the ASX 200 was down 19 points, while the Nikkei Index was up by 170 points.

ASX 200

ASX 200 ended Wednesday in positive territory.
ASX200 090524 Daily Chart

The ASX 200 advanced by 0.14% on Wednesday (May 8). Banking, oil, and tech stocks contributed to the gains. The S&P/ASX All Tech Index gained 0.46%.

Woodside Energy Group Ltd (WDS) and Santos Ltd (STO) saw gains of 0.14% and 1.06%, respectively.

ANZ Group Holdings Ltd. (ANZ) and Commonwealth Bank of Australia (CBA) advanced by 1.15% and 0.62%, respectively. National Australia Bank Ltd. (NAB) fell by 0.53%, while Westpac Banking Corp. (WBC) ended the session flat.

Moreover, gold-related stocks also had a mixed Wednesday (May 8) session.

Northern Star Resources Ltd. (NST) fell by 0.68%, while Evolution Mining Ltd (EVN) rose by 0.26%.

BHP Group Ltd (BHP) and Rio Tinto Group Ltd. (RIO) declined by 0.09% and 1.15%, respectively. Fortescue Metals Group Ltd. (FMG) fell by 0.52%.

Hang Seng Index

Hang Seng Index declined for the second session.
HSI 090524 Daily Chart

The Hang Seng Index fell by 0.90% on Wednesday (May 8). Real estate and tech stocks contributed to the losses. The Hang Seng Tech Index (HSTECH) declined by 1.29%, with the Hang Seng Mainland Properties Index (HSMPI) sliding by 4.05%.

Alibaba (9988) and Tencent (0700) extended their losses from Tuesday (May 7), falling by 2.43% and 1.20%, respectively.

However, bank stocks had a mixed session. HSBC (0005) rose by 0.93%. China Construction Bank (0939) and Industrial Commercial Bank (1398) ended the session down 0.76% and 0.46%, respectively.

The Nikkei Index

Nikkei stumbled on Wednesday.
Nikkei 090524 Daily Chart

(Graph for reference purposes only)

The Nikkei Index slid by 1.63% on Wednesday (May 8), reversing gains from Tuesday (May 7).

Bank stocks had a negative session. Sumitomo Mitsui Financial Group Inc. (8316) and Mitsubishi UFJ Financial Group Inc. (8306) fell by 1.19% and 0.51%, respectively.

It was also a negative session for the main components of the Nikkei Index.

Sony Group Corporation (6758) tumbled 4.97% on the concerns about the Paramount Global acquisition. Fast Retailing Co. Ltd. (9983) and KDDI Corp. (9433) slid by 2.26% and 2.28%, respectively. Tokyo Electron Ltd. (8035) fell by 1.52%, with Softbank Group Corp. (9948) ending the session down 1.70%.

For upcoming economic events, refer to our economic calendar.

About the Author

Bob Masonauthor

With over 20 years of experience in the finance industry, Bob has been managing regional teams across Europe and Asia and focusing on analytics across both corporate and financial institutions. Currently he is covering developments relating to the financial markets, including currencies, commodities, alternative asset classes, and global equities.

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