It was a bearish morning for Asian markets, with the Hang Seng and ASX 200 posting heavy losses. Market angst over the US Jobs Report and news that SVB Financial Group (SIVB) is falling into trouble sent major Asian companies into the red. However, the Bank of Japan cushioned the fall of the Nikkei.
It was a bearish morning for Asian markets, with the Hang Seng and ASX 200 posting heavy losses. The bearish sentiment from the US session carried over into the morning session as investors turned their attention to the all-important US Jobs Report.
Following unexpectedly aggressive testimony from Fed Chairman Powell on Tuesday, another better-than-expected jobs report could boost rate top forecasts, raising the threat of a global recession and a US hard landing.
Beyond the economic calendar, SVB Financial Group (SIVB) announced a $1.75 billion share sale to address balance sheet issues, spooking investors following the demise of Silvergate Bank.
On Thursday, the NASDAQ Composite Index fell 2.05%, and the Dow and S&P 500 posted losses of 1.66% and 1.85%, respectively.
Market Overview
The ASX 200 was down 2.07%. There were no economic indicators out of Australia to influence, leaving Fed Fear to control investor sentiment ahead of the US Jobs Report. Bank shares followed their US peers in dark red on SVB Financial Group news (SIVB).
Bank stocks were in free fall. ANZ Group (ANZ) and Commonwealth Bank of Australia (CBA) fell 3.27% and 3.34%, respectively. Westpac Banking Corp (WBC) and National Australia Bank (NAB) were down 3.08% and 3.11%, respectively.
Oil stocks were also in negative territory, with Woodside Energy Group (WDS) slipping 3.09% and Santos Ltd (STO) slipping 2.16%. The fall in oil prices since Thursday, as well as a further decline this morning, weighed on oil stocks. Brent crude was down 0.50% at $81.18 this morning.
Mining stocks had a mixed session. Rio Tinto (RIO) and BHP Group Ltd (BHP) were down 2.53% and 2.6% respectively, and Fortescue Metals Group (FMG) was down 2.80%. Newcrest Mining (NCM) bucked the downtrend, rising 0.86%.
Hang Seng Index
The Hang Seng was down 2.49% this morning, with market angst ahead of the weight of the US Jobs Report. In terms of the main constituents of the index, Tencent Holdings Ltd (HK:0700) was down 1, 70%, while Alibaba Group Holding Ltd (HK:9988) fell 3.31%.
Nikkei 225
Nikkei 225 was down a relatively modest 0.43% this morning, with stronger USD/JPY at 136.69 cushioning the decline. Economic data and the Bank of Japan failed to deliver a bullish session.
Household spending rose 2.7% in January, reversing a 2.1% drop since December. Economists forecast a more modest rise of 1.4%. Year-over-year, spending fell 0.3% versus an expected decline of 0.1%. In December, household spending fell by 1.3%.
There were no surprises from the Bank of Japan to move the dial. In line with expectations, the Bank of Japan left interest rates at negative 0.1%. The Bank also made good on its promise to maintain ultra-loose monetary policy by leaving the bond yield cap and yield control policy unchanged.
Looking at the main components, Fast Retailing Co (9983) and KDDI Corp (9433) fell 0.96% and 0.12%, respectively. Sony Corp (6,758) and SoftBank Group Corp. (9,984) posted larger losses of 2.49% and 3.37%, respectively. However, Tokyo Electron rose 0.29%.
By Audy Castaneda
