Hang Seng Index, Nikkei 225, ASX 200: Futures Flash Green Ahead of the US CPI Report

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Updated: Apr 8, 2024, 22:59 UTC

Key Points:

It was a positive start to the week for the Asian equity markets, with investors digesting the US Jobs Report.
On Tuesday, US consumer inflation expectations and Fed chatter from Monday warrant investor consideration.
The Asian economic calendar will put investor focus on the ASX 200 and the Nikkei.

US Equity Markets: US Consumer Inflation Expectations

On Tuesday, US consumer inflation expectations numbers from Monday warrant investor attention. Consumer inflation expectations remained steady at 3.0%. Economists forecast consumer inflation expectations to decline to 2.9%.

The US equity markets were cautious after the US Jobs Report and the Friday US equity market gains. 10-year US Treasury yields hit a session high of 4.462% before ending the day at 4.422%. The market focus was on the US CPI Report (Wed) and the beginning of the earnings season (Fri).

On Monday, the Dow and the S&P 500 declined by 0.03% and 0.04%, respectively. The Nasdaq Composite Index gained 0.03%.

Asian Economic Calendar: Consumer Confidence and Machinery Orders in Focus

On Tuesday, investors should consider consumer confidence and machinery orders from Japan. A pickup in consumer confidence may fuel consumer spending and demand-driven inflation. The Bank of Japan could take a more hawkish stance to manage inflation. The net effect could be increasing buyer demand for the Japanese Yen, which may impact Nikkei-listed export stocks.

Economists forecast consumer confidence to increase from 39.1 to 40.0 in March.

Machine tool orders may also affect the Bank of Japan rate path. An improving demand environment could raise investor bets further on a BoJ move from zero rates.

Economists forecast machine tool orders to decline by 5.0% year-on-year in March. In February, machine tool orders were down 8.0% year-on-year.

Commodities: Crude Oil, Gold, and Iron Ore Price Trends

Commodity price trends from Monday need investor consideration.

Crude oil pulled back on hopes of a ceasefire in the Middle East, while gold prices were higher on demand from central banks. Iron ore prices were also higher on Monday on hopes of an improving demand environment. The upswing in iron ore and gold prices could influence buyer demand for ASX-listed stocks.

The USD/JPY, the Intervention Zone, and the Nikkei

The USD/JPY remained within the intervention zone at 151.792 on Tuesday. 152 likely remains the line in the sand for the Japanese government. Further intervention threats could pressure the USD/JPY and impact Nikkei-listed export stocks.

The Futures Markets

On Tuesday, the ASX 200 and the Nikkei were up 36 and 90 points, respectively.

ASX 200

ASX200 090424 Daily Chart

The ASX 200 advanced by 0.20% on Monday, tracking the Friday US equity market gains. Bank, gold (XAU/USD), mining, and tech stocks contributed to the gains. The S&P ASX All Technology Index (XTX) rose by 0.97%.

Gold stocks Northern Star Resources Ltd. (NST) and Evolution Mining Ltd (EVN) saw gains of 2.02% and 0.51%, respectively. Gold prices climbed higher on Friday, driving buyer demand for gold stocks.

Rio Tinto Ltd. (RIO) and Fortescue Metals Group Ltd. (FMG) ended the session up 1.00% and 0.32%, respectively. BHP Group Ltd (BHP) bucked the trend, falling 0.23%.

ANZ Group Holdings Ltd. (ANZ) and Westpac Banking Corp. (WBC) rose by 0.27% and 0.27%, respectively. Commonwealth Bank of Australia (CBA) and National Australia Bank Ltd. (NAB) saw gains of 0.13% and 0.35%, respectively.

Woodside Energy Group Ltd (WDS) and Santos Ltd (STO) saw losses of 1.63% and 1.01%, respectively. Oil prices hit the reverse on easing tensions in the Middle East.

Hang Seng Index

HSI 090424 Daily Chart

On Monday, the Hang Seng Index gained 0.05%. Tech stocks and property stocks limited the upside. The Hang Seng Tech Index (HSTECH) and Hang Seng Mainland Properties Index (HSMPI) declined by 0.18% and 0.17%, respectively.

Tencent (0700) fell by 1.48%, while Alibaba (9988) rose by 0.50%.

Bank stocks had a positive session. HSBC (0005) ended the day up 0.72%. China Construction Bank (0939) and Industrial Commercial Bank (1398) saw gains of 0.83% and 1.26%, respectively.

The Nikkei 225

The Nikkei advanced on a stronger USD/JPY.

Nikkei 090424 Daily Chart

(Graph for reference purposes only)

The Nikkei rose by 0.91%. A stronger USD/JPY drove buyer demand for Nikkei-listed export stocks.

Bank stocks ended the session in positive territory. Sumitomo Mitsui Financial Group Inc. (8316) and Mitsubishi UFJ Financial Group Inc. (8306) advanced by 1.27% and 1.44%, respectively.

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

Fast Retailing Co. Ltd. (9983) gained 1.56%. Softbank Group Corp. (9948) and Tokyo Electron Ltd. (8035) ended the session up 0.74% and 1.05%, respectively.

KDDI Corp. (9433) and Sony Group Corporation (6758) saw gains of 0.02% and 0.16%, respectively.

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.