Asian Markets Mostly Lower Amid Inflation Woes

Asian stock markets are trading mostly lower on Monday, following the broadly negative cues from Wall Street on Friday on mixed retail sales data and an unexpected slump in US consumer sentiment in July amid concerns about inflation. Traders are also spooked by the spread of the delta variant of the coronavirus across the world, which is expected to slow the pace of the global economic recovery from the pandemic. Asian markets closed mixed on Friday.

The Australian stock market is significantly lower on Monday, after a slight loss in the previous session, with the benchmark S&P/ASX 200 moving below 7,300 level, following the broadly negative cues from Wall Street on Friday. The market is dragged by mining, materials, financial and energy firms as the nation’s two biggest cities are under strict lockdown amid a resurgence in coronavirus.

Victoria has recorded 12 new local cases on Sunday after the number of COVID-19 exposure sites increased to more than 275, with the chances of the ongoing lockdown ending soon looking bleak. New South Wales recorded 105 new local cases of coronavirus and one death on Sunday.

The benchmark S&P/ASX 200 Index is losing 58.20 points or 0.79 percent to 7,289.90, after hitting a low of 7,249.20 earlier. The broader All Ordinaries Index is down 63.60 points or 0.83 percent to 7,567.10. Australian stocks closed marginally higher on Friday.

Among the major miners, BHP Group and Rio Tinto are losing more than 2 percent each, while Mineral Resources edging down 0.3 percent, OZ Minerals is down more than 3 percent and Fortescue Metals is declining almost 1 percent.

Oil stocks are lower, with oil Search, Santos and Origin Energy losing almost 2 percent each, while Woodside Petroleum is down more than 1 percent and Beach energy is flat.

Among tech stocks, Afterpay and WiseTech Global are adding almost 1 percent each, while Xero is gaining 1 more than percent. Appen is losing almost 1 percent.

Gold miners are higher. Evolution Mining is losing almost 6 percent, Northern Star Resources is down almost 2 percent, Gold Road Resources is declining more than 3 percent and Newcrest Mining is lower by more than 1 percent. Resolute Mining is losing almost 3 percent.

Among the big four banks, Westpac and National Australia Bank are losing more than 2 percent each, while Commonwealth Bank and ANZ Banking are down almost 2 percent each.

In other news, Telstra confirmed it is in talks to buy Pacific Digicel and its mobile and undersea cable networks, under a joint offer lodged by the federal government and the telco giant, with the government pitching in with 75% of the $2 billion transaction amount, in a bid to keep out Chinese firms. Telstra is down more than 1 percent.

Shares in humm group are up almost 3 percent after the buy-now-pay-later firm said it cash profit for the year is expected to more than double to $68.4 million, driven by a 20 percent jump in users and a record fourth quarter for transaction volumes.

Shares in software maker Altium are plunging more than 10 percent after US design technology giant Autodesk confirmed it is walking away from the $5 billion takeover offer. Altium had rejected the offer in early June. Altium shares are currently halted after 5 minutes of trading.

In the currency market, the Aussie dollar is trading at $0.738 on Monday.

Japanese stock market is sharply lower on Monday, extending the losses of the previous three sessions, with the Nikkei 225 losing more than 400 points to slip below the 27,600 level, following the broadly negative cues from Wall Street on Friday. Traders also continue to be spooked amid the surge in the spread of the highly contagious coronavirus variants as even some Tokyo Olympics participants have tested positive.

The benchmark Nikkei 225 Index closed the morning session at 27,584.99, down 418.09 points or 1.49 percent, after hitting a low of 27,493.63 earlier. Japanese shares ended significantly lower on Friday.

Market heavyweight SoftBank Group is losing more than 2 percent and Uniqlo operator Fast Retailing is down more than 1 percent. Among automakers, Honda is losing more than 2 percent and Toyota is down more than 1 percent.

The major exporters are higher, with Canon and Panasonic losing almost 2 percent each, while Mitsubishi Electric and Sony are down more than 1 percent each.

In the tech space, Advantest is losing more than 1 percent, Tokyo Electron is down almost 2 percent and Screen Holdings is declining more than 3 percent. In the banking sector, Sumitomo Mitsui Financial is losing more than 1 percent, while Mizuho Financial and Mitsubishi UFJ Financial is down almost 2 percent each.

Among the other major losers, Taiyo Yuden is down almost 5 percent, while Ebara, Fujikura and Japan Steel Works are losing more than 4 percent each. Konica Minolta, Showa Denko K.K., Hitachi Zosen, Nippon Sheet Glass, NTN, Nikon, Sumco, JTEKT and Sharp are all lower by almost 4 percent each. Okuma and Kobe Steel are declining more than 3 percent each.

Conversely, Chugai Pharmaceutical is gaining more than 2 percent.

In the currency market, the U.S. dollar is trading in the higher 109 yen-range on Monday.

Elsewhere in Asia, Hong Kong is plunging 2.1 percent, South Korea is losing 1.1 percent and Singapore is down 1 percent, while New Zealand, Taiwan, Indonesia and China are lower by between 0.1 and 0.8 percent each. Malaysia is bucking the trend and is up 0.6 percent.

On Wall Street, stocks moved mostly lower over the course of the trading session on Friday after failing to sustain an early move to the upside. The major averages pulled back well off their initial highs and slid firmly into negative territory.

The major averages ended the session just off their worst levels of the day. The Dow slumped 299.17 points or 0.9 percent to 34,687.85, the Nasdaq slid 115.90 points or 0.8 percent to 14,427.24 and the S&P 500 fell 32.87 points or 0.8 percent to 4,327.16.

The major European markets all also moved to the downside on the day. While the U.K.’s FTSE 100 Index edged down by 0.1 percent, the French CAC 40 Index and the German DAX Index slid by 0.5 percent and 0.6 percent, respectively.

Crude oil futures settled slightly higher Friday, moving up after two days of sharp losses but ending with a sharp weekly loss. Worries about outlook for energy demand due to the surge in the delta variant of the coronavirus weighed on the commodity.

Also, OPEC+ agreed on a deal to increase crude output over the weekend, putting further pressure on prices. West Texas Intermediate Crude oil futures for August ended up by $0.16 or 0.2 percent on Friday at $71.81 a barrel; oil futures shed nearly 4 percent in the week.

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