Asian Stock Market: Grinds higher as Omicron, China flash mixed signals

Asian equities trade mixed, mostly higher as market sentiment dwindles ahead of the key US inflation data.
Fresh fears over covid variant join Evergrande-linked woes to favor bears, stimulus hopes, vaccine news keep buyers hopeful.
China CPI jumped the most since August 2020, PPI eased from 26-year high in November.
Sino-American tussles, US-Iran tension also poke upside momentum.

Anil Panchal FXStreet

Asian equities remain mostly firmer as stimulus hopes battle virus woes heading into Thursday’s European session. To portray the mood, the MSCI’s index of Asia-Pacific shares outside Japan jumps 0.81% but Japan’s Nikkei 225 drops 0.15% at the latest.

Return of the virus-led activity restrictions in Germany, France and the UK renews COVID-19 fears. However, headlines from leading covid vaccine producers signal the effectiveness of booster shots to tame the South African coronavirus variant, dubbed as Omicron.

Elsewhere, China’s Consumer Price Index (CPI) jumped the most since August 2020, by 2.3% YoY and 0.4% MoM in November. Further, the Producer Price Index (PPI) crossed 12.6% forecasts to arrive at 12.9% YoY in November. Further, the People’s Bank of China (PBOC) raised the Yuan mid-point to the highest in 3.5 years, to 6.3498 yuan per dollar, to battle the challenges at home.

Among the key issues worrying China are the geopolitical tussles with the US and fears of default emanating from Evergrande and Kaisa are the major ones. Recently, US Assistant Secretary of Defense for Indo-Pacific Security Affairs Ely Ratner said, “Bolstering Taiwan's self-defenses is an ‘urgent task’ and an essential feature of deterring China”.

Amid these plays, stocks in China and Hong Kong remain positive but not Australian equities. Further, New Zealand’s NZX 50 drops around 1.5% by the press time. It’s worth noting that South Korea’s KOSPI and Indonesia’s IDX Composite print mild gains whereas India’s BSE Sensex drops 0.15% even after the Reserve Bank of India (RBI) kept monetary policy unchanged the previous day.

On a broader front, fresh fears of the Fed rate hike propel the US Treasury yields and weigh on the stock futures. However, oil prices remain firmer on concerns relating to Ukraine and Iran.

Looking forward, market players will remain at loggerheads and could witness a lack of major moves ahead of the key US inflation data, up for publishing on Friday.

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

AUD/USD eyes 0.7150 barrier nine-day EMA

AUD/USD inches higher after registering modest losses in the previous day, trading around 0.7130 during the Asian hours. The technical analysis of the daily chart indicates that the pair is moving sideways within the rectangle pattern, suggesting a consolidation as neither the bulls nor the bears have enough momentum to take control of the market.

USD/JPY trades below 160.00 intervention threshold; bullish bias intact

The USD/JPY pair attracts some sellers during the Asian session amid fears that authorities will step in again to prop up the Japanese Yen. Furthermore, the Israel-Lebanon truce prompts some profit-taking around the US Dollar and exerts downward pressure on the currency pair.

Gold meets contention near $4,420…for now

Gold extends its recovery past the $4,500 mark per troy ounce on Thursday. The yellow metal’s advance comes amid the resurgence of some selling interest around the, improving risk sentiment, and declining US Treasury yields across the curve.

Bitcoin’s massive storm is back: Why the sell-off is far from over

Bitcoin price action over the last few weeks has felt less like a normal, healthy correction and more like a slow grinding crash that continues to wreak havoc on holdings and trading accounts. And everything suggests that the dramatic crash isn’t over.

Nonfarm payrolls: Testing the limits of Fed policy patience

The upcoming nonfarm payrolls report for May will provide the final update on the US labor market before Kevin Warsh attends his first policy meeting as the new Fed Chair later this month.

Recession on paper: What really moves the Canadian Loonie now?

Statistics Canada handed the headline writers a gift and the analysts a headache. Real GDP shrank 0.1% on an annualized basis in the first quarter, and with the fourth quarter of 2025 revised down to a 1.0% contraction, that is two negative quarters in a row, the textbook definition of a technical recession and Canada's first since the pandemic.