Asian Stock Market: Shanghai dives as China inflation misses estimates, risk-off solidifies, oil juggles

The risk-off mood ahead of US inflation is keeping Asian indices on the tenterhooks.
Softer-than-anticipated China inflation numbers have impacted Chinese equities heavily.
Japanese investors are highly focused for the novel leadership of the BoJ for further cues.

Sagar Dua FXStreet

Markets in the Asian domain are demonstrating weakness considering the risk-off market mood propelled ahead of the United States Consumer Price Index (CPI) data, scheduled for Tuesday. S&P500 futures are facing immense pressure as investors are worried that more interest rate hikes by Federal Reserve (Fed) chair Jerome Powell in his battle against stubborn inflation. The 500-US stocks basket futures have reported a sell-off in the past two trading sessions and more losses are in pipeline considered the current move.

At the press time, Japan’s Nikkei225 added 0.25%, ChinaA50 dropped 0.63%, Hang Seng plunged 1.80%, and Nifty50 surrendered 0.36%.

The expression of deflation from China’s Consumer Price Index (CPI) (Jan) report has impacted equities dramatically. The annual inflation data has landed at 2.1%, between the consensus of 2.2% and the prior release of 1.8%. The monthly inflation figure has shown a deflation of 0.8% against an expansion in the inflationary pressures by 0.7%.

Meanwhile, China’s Producer Price Index (PPI) has shown a deflation of 0.8% higher than the projections of 0.5% and the former release of 0.7%. It indicates that producers are heavily cutting prices of goods and services at factory gates due to weak demand by the households.

This might compel the People’s Bank of China (PBoC) and the Chinese authorities to fuel helicopter money to support the economy, which is still recovering from the rollback of pandemic curbs.

Japanese stocks are mildly positive as investors are gearing up for novel Bank of Japan (BoJ) leadership after a long period of service by current Governor Haruhiko Kuroda. Japan’s government might reveal the new nomination for BoJ Governor on Feb 14.

The oil price is juggling above the critical support of $77.50 after a softer China inflation data. An absence in consumer spending recovery despite the lifting of the pandemic controls is indicating that investors need to wait more than anticipated as the economy will take sufficient time in achieving pre-pandemic growth levels.

Nikkei 225

Overview
Today last price	27581.2
Today Daily Change	0.00
Today Daily Change %	0.00
Today daily open	27581.2

Trends
Daily SMA20	27145.72
Daily SMA50	26933.26
Daily SMA100	27170.26
Daily SMA200	27250.12

Levels
Previous Daily High	27733.79
Previous Daily Low	27511.62
Previous Weekly High	27766.36
Previous Weekly Low	27191.99
Previous Monthly High	27619.58
Previous Monthly Low	25549.18
Daily Fibonacci 38.2%	27648.92
Daily Fibonacci 61.8%	27596.49
Daily Pivot Point S1	27483.95
Daily Pivot Point S2	27386.7
Daily Pivot Point S3	27261.78
Daily Pivot Point R1	27706.12
Daily Pivot Point R2	27831.04
Daily Pivot Point R3	27928.29

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

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