Asian Markets Are Mostly Up

Despite broadly negative cues from Wall Street overnight, Asian stock markets are mostly higher on Wednesday, with traders cautiously assessing recent economic data from around the world and speculating about the Bank of Japan's policy stance, which is expected to shift away from its decade-long ultra-loose monetary policy. Tuesday's Asian markets ended neutral.

Traders are also hoping to capitalize on recent market success despite persistent worries about the economy and interest rates.

Despite broadly negative cues from Wall Street overnight, the Australian stock market is trading modestly higher in choppy trading on Wednesday, recouping the previous session's slight losses, with the benchmark S&P/ASX 200 moving a tad above the 7,400 level, aided by gains in energy firms on firmer oil prices and technology stocks. Meanwhile, mining and finance equities were generally down.

The benchmark S&P/ASX 200 Index is up 20.50 points, or 0.28 percent, to 7,406.80 after earlier reaching a high of 7,410.80. The wider All Ordinaries Index has increased by 24.50 points, or 0.32 percent, to 7,622.10. On Tuesday, Australian equities finished marginally lower.

BHP Group and Mineral Resources are both dropping about 1%, while Rio Tinto and OZ Minerals are both up 0.4 to 0.5 percent. Fortescue Metals has down 0.2 percent.

The majority of oil stocks are down. Beach Energy and Woodside Energy are both dropping about 1%, while Origin Energy is losing 1.5 %. Santos is up 0.5 percent.

In the IT sector, Afterpay owner Block is up over 4%, while WiseTech Global, Xero, and Appen are all up more than 1%. Zip is losing over 3% of its market value.

National Australia Bank and Commonwealth Bank are both edging up 0.1 to 0.2 percent, while ANZ Banking and Westpac are both edging down 0.2 to 0.4 percent.

Gold miners Newcrest Mining and Northern Star Resources are both dropping about 1%, while Gold Road Resources is losing almost 4%. Evolution Mining is up 0.5 percent, while Resolute Mining is unchanged.

On Wednesday, the Australian dollar is trading at $0.699 on the currency market.

Despite broadly negative cues from Wall Street overnight, the Japanese stock market is significantly higher on Wednesday, extending the previous session's gains, with the Nikkei 225 moving a tad above the 26,300 level, as traders are cautious amid speculation the Bank of Japan will exit its decade-long ultra-loose monetary policy on Wednesday.

The Nikkei 225 Index completed the morning session at 26,301.86, up 163.18 points or 0.62 percent from its previous high of 26,336.25. On Tuesday, Japanese markets finished significantly higher.

SoftBank Group is up 0.3 percent, while Fast Retailing, the operator of Uniqlo, is down 0.2 percent. Honda is losing over 1% of its market value, while Toyota is losing 0.1 percent.

In the technology sector, Screen Holdings is down 0.3 percent, while Advantest is up almost 1%. Tokyo Electron is completely flat.

In the banking sector, Sumitomo Mitsui Financial and Mizuho Financial are both losing about 1%, while Mitsubishi UFJ Financial is losing almost 2%.

Mitsubishi Electric, Panasonic, and Canon are all up 0.2 to 0.3 percent, while Sony is unchanged.

Among the other notable gainers, Amanda is up nearly 5%, Konami Group is up more than 4%, Chugai Pharmaceutical is up more than 3%, while Terumo, Denka, and OKUMA are up nearly 3% apiece.

In contrast, there are no significant losers.

In economic news, the Bank of Japan will conclude its monetary policy meeting and announce its interest rate decision on Wednesday. The Bank of Japan is largely anticipated to maintain its benchmark lending rate at -0.10 percent.

The value of core machine orders in Japan fell 8.3 percent month on month in November, according to the Cabinet Office, totaling 838.8 billion yen. That fell well short of estimates for a 9% drop after a 5.4 percent growth in October. Core machine orders fell 3.7 percent year on year, falling short of predictions for a 2.4 percent growth after a 0.4 percent increase the previous month. Core machine orders are predicted to increase by 3.6 percent in the fourth quarter of 2022 and by 5.3 percent year on year.

On Wednesday, the US dollar is trading around the mid-130 yen region in the currency market.

Elsewhere in Asia, New Zealand, China, Hong Kong, Singapore, and Indonesia are all 0.1 to 0.2 percent higher. Malaysia and South Korea are both down 0.7 and 0.2 percent. Taiwanese markets are closed till January 30 for the Lunar New Year vacation.

After bouncing early in the day, equities on Wall Street have drifted largely down during the course of the trading day on Tuesday. The main averages have all gone the negative, with the Dow leading the way.

In recent trade, the Dow and the S&P500 have set fresh session lows. The Dow Jones Industrial Average is down 389.56 points, or 1.1 percent, to 33,913.05; the S&P500 is down 12.01 points, or 0.3 percent, to 3,987.08; and the Nasdaq is down 35.31 points, or 0.3 percent, to 11,043.84.

Meanwhile, the main European markets have been volatile today. While the FTSE 100 Index in the United Kingdom is down 0.3 percent, the German DAX Index and the French CAC 40 Index are both up 0.2 percent.

On Tuesday, crude oil futures finished higher on hopes of a surge in demand after better-than-expected Chinese GDP figures. West Texas Intermediate crude oil futures for February closed $0.32 higher, or 0.4 percent higher, at $80.18 a barrel, the highest settlement since December 30.

Stay tuned for more forex market analysis.

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