Hang Seng Index, ASX200, Nikkei 225: US CPI Anxiety Tests Appetite

• It was a mixed Wednesday morning for the Asian markets, with the Hang Seng Index seeing red while the ASX 200 and the Nikkei found support.
• There were no economic indicators from the region to distract investors, with the US CPI Report and FOMC Meeting Minutes in focus.
• US Futures sent bullish signals, though the gains were modest.

Market Overview

It was a mixed morning for the Asian markets. The Hang Seng Index struggled, while the Nikkei and ASX 200 found morning support. With no US economic indicators from Tuesday to influence, investors were cautious ahead of today’s US CPI Report and FOMC meeting minutes.

The markets are betting on a 25-basis point interest rate hike in May. Today’s CPI Report will likely decide the outcome of the May meeting. According to the FedWatchTool, the markets see a 69.8% chance of a 25-basis point interest rate hike.

However, the IMF failed to spook investors despite the warning of the risks of a new crisis that could impact global growth. The IMF/World Bank Spring Meetings will get underway today.

After a mixed Tuesday session, the US futures sent bullish signals. The NASDAQ min was up 0.25 points, with the Dow rising by 27.

ASX 200

The ASX 200 was up 0.53%, with mining stocks delivering support ahead of RBA chatter later this morning. Last week, RBA Governor Philip Lowe warned that hitting the pause button did not mean an end to the monetary policy tightening cycle. Today RBA Deputy Governor Michele Bullock could provide more color.

The big-4 were in negative territory this morning, with the Commonwealth Bank of Australia (CBA) and National Australia Bank (NAB) falling by 0.85% and 0.78%, respectively. ANZ Group (ANZ) declined by 0.13%, with Westpac Banking Corp (WBC) down 0.27%.

Oil stocks had a mixed morning. Woodside Energy Group (WDS) rose by 0.06%, while Santos Ltd (STO) declined by 0.07%. This morning, Brent was flat at $85.61.

However, mining stocks delivered support. Rio Tinto (RIO) and BHP Group Ltd (BHP) were up by 3.06% and 2.65%, respectively, with Fortescue Metals Group (FMG) rising by 2.19%. Newcrest Mining (NCM) increased by a more modest 0.12%.

Hang Seng Index

The Hang Seng was down 0.75% this morning. Investor sentiment toward the US CPI Report and Fed monetary policy weighed.

Considering the main components, Tencent Holdings Ltd (HK:0700) and Alibaba Group Holding Ltd (HK:9988) fell by 3.72% and 1.91%, respectively.

However, it was a mixed morning for banking stocks. HSBC Holdings PLC fell by 0.55%, while the Industrial and Commercial Bank of China (HK:1398) and China Construction Bank (HK: 0939) rose by 0.24% and 0.39%, respectively.

CNOOC (HK: 0883) was up by 0.33%.

Nikkei 225

The Nikkei 225 was up 0.16% this morning, with a stronger USD/JPY delivering support.

Sumitomo Mitsui Financial Group (8316) rose by 0.26%, while Mitsubishi UFJ Financial Group slipped by 0.16%.

Looking at the main components, SoftBank Group Corp. (9984) rose by 1.76%, with Sony Corp (6758) and KDDI Corp (9433) seeing gains of 0.46% and 0.52%, respectively. While Fast Retailing Co (9983) rose by 0.22%, Tokyo Electron Limited (8035) fell by 0.91%.

Check out our economic calendar for today’s economic events.