GLOBAL MARKETS DJIA 33517.65 -112.96 -0.34% Nasdaq 10635.65 66.36 0.63% S&P 500 3892.09 -2.99 -0.08% FTSE 100 7724.94 25.45 0.33% Nikkei Stock 26236.77 262.92 1.01% Hang Seng 21351.18 -37.16 -0.17% Kospi 2367.28 17.09 0.73% SGX Nifty* 18145.50 -27.5 -0.15% *Jan contract USD/JPY 131.83-84 -0.04% Range 132.22 131.41 EUR/USD 1.0727-30 -0.06% Range 1.0745 1.0722 CBOT Wheat March $7.414 per bushel Spot Gold $1,868.50/oz -0.2% Nymex Crude (NY) $74.82 $1.05 US STOCKS
U.S. stocks pared some of their early gains, with investors still weighing bets about whether the Federal Reserve might dial back its aggressive pace of increases in interest rates.
The S&P 500 fell 0.1%, paring earlier gains of as much as 1.4%. The Dow Jones Industrial Average fell 0.3%, also reversing earlier gains. The tech-focused Nasdaq Composite Index rose 0.6%.
Money managers said the Federal Reserve and other central banks will want to see a sustained decline in inflation before they consider pausing efforts to tighten monetary policy. "In 2023, we'll need to see almost all numbers pointing in the right direction to maintain this rally," said Edward Park, chief investment officer at London-based Brooks Macdonald.
ASIAN STOCKS
Japanese stocks were higher in early trade, led by gains in machinery, electronics and tech stocks, as hopes grow over the Fed's less aggressive tightening. Among individual movers, Eisai was 7.6% higher after U.S. FDA approved its new Alzheimer's drug. Investors are focusing on bond yields, economic data and their implications for monetary policy. The Nikkei Stock Average was 1.3% higher at 26307.03.
South Korea's benchmark Kospi edged 0.2% higher to 2354.86 in early mixed trade. Battery and chemicals stocks advanced, while internet and consumer stocks were lower. Foreign and institutional investors were net buyers, while retail investors were net sellers. LG Energy Solution rose 3.9% after news reports that Ford Motor is seeking to partner with the South Korean battery maker to launch a joint venture in Turkey.
Hong Kong's Hang Seng Index fell 0.8% to 21225.42, led by tech shares. The de-risking by market participants could be coming from fears that Fed Chair Powell's upcoming speech may mirror recent hawkish comments from other Fed officials with some pushback against the view that the Fed may slow its tightening, said Yeap Jun Rong, market analyst at IG, in an email. The Hang Seng Tech Index was down 1.5% at 4500.38.
Chinese shares opened higher, extending a rally as China's reopening and its expected economic recovery buoyed stocks. Chip makers and food producers climbed. The Shanghai Composite Index rose 0.1% to 3178.02, the Shenzhen Composite Index was up 0.05% and the ChiNext Price Index was 0.1% higher.
FOREX
Most Asian currencies strengthened against the U.S. dollar in the Asian morning session amid prospects for less Fed tightening. Last week's U.S. labor-market data and the possibility of a U.S. recession are likely to keep Fed rate-increase expectations constrained, MUFG Bank's senior currency analyst Jeff Ng said in a research note. The U.S. dollar remains on the back foot and the current momentum may persist ahead of U.S. CPI data due later this week, Ng added. USD/KRW edged 0.1% lower to 1,237.84, USD/SGD was down 0.1% at 1.3295 and AUD/USD rose 0.1% to 0.6923.
METALS
Gold was slightly lower in early trade. While the price of the precious metal previously gained amid hopes that the U.S. Federal Reserve could slow down the pace of tightening, the rally is likely to run out of steam as traders remain wary ahead of December's inflation report, said Oanda senior market analyst Edward Moya in a note. Expectations are for inflation to have cooled during the month as energy costs declined, but core CPI could struggle to come down as quickly, he added. Persistent inflation could signal continued tightening, which is typically viewed as negative for gold prices. Spot gold was down 0.2% at $1,868.50/oz.
OIL SUMMARY
Crude-oil prices were mixed in early Asian trade, following gains in the previous session as traders weighed a brighter demand outlook from China against continued uncertainty about a global economic slowdown. Analysts expect the price of crude oil to remain supported this year due to higher demand from top consumer China. China has recently issued a fresh batch of import quotas, in a signal that the country is ramping up to meet higher demand said Saxo market strategist Charu Chanana in a note. The front-month WTI futures contract was flat at $74.65/bbl, while the front-month Brent crude contract was down 0.2% at $79.52/bbl.
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(END) Dow Jones Newswires
01-09-23 2215ET
