Asia stocks mixed as investors remain cautious amid uncertainty


Stocks in China were mostly negative by the end of the morning session as investor sentiment remained cautious.

The Shanghai composite was down by 0.55 percent while the Shenzhen composite slipped 0.321 percent.

Meanwhile, Hong Kong’s Hang Seng index was largely flat.

China’s markets have been closely watched by investors as a result of the ongoing trade spat between Beijing and Washington, with an anticipated meeting between Presidents Xi Jinpingand Donald Trump at the upcoming G-20 meeting in Buenos Aires from Nov. 30 to Dec. 1.

One analyst told CNBC’s “Street Signs” on Thursday that he is “not too hopeful” about next week’s meeting.

“Both sides seem to be incredibly confused,” said Andrew Collier, managing director at Orient Capital Research.

On the U.S. side, Collier said: “In the past couple of weeks you’ve had a situation where (Larry) Kudlow and (Peter) Navarro, the two economics gurus in D.C. are fighting with each other openly.”

While in China, he added, former top trade negotiator Long Yongtu “made some nasty comments about the Chinese negotiating style” — something that was “kind of startling” given Long’s former position as a senior official, Collier said.

Rest of Asia mostly sees gains

Elsewhere in Asia, the picture appeared more positive overall for stocks.

Japan’s Nikkei 225 returned to positive trade in the afternoon, seeing gains of nearly 0.6 percent while the Topix advanced 0.6 percent.

Shares of Japan’s largest bank, Mitsubishi UFJ Financial Group, fell nearly 2.5 percent in the afternoon after the New York Times reported that U.S. prosecutors are said to be investigatingthe lender’s systems to track money laundering.

The moves in Tokyo came after Japan’s core consumer prices saw a gain of 1.0 percent on a year-on-year basis, in line with expectations from economists surveyed in a Reuters poll.

In Australia, the benchmark ASX 200rose 0.9 percent, with most sectors in positive territory.

The heavily weighted financial subindex advanced 0.76 percent, with shares of Australia’s so-called Big Four banks mostly seeing gains. Australia and New Zealand Banking Group rose 1.57 percent, Commonwealth Bank of Australia gained 0.99 percent and National Australia Bank advanced 1.12 percent. Westpac was marginally higher by 0.2 percent.

Meanwhile, South Korea’s Kospi slipped 0.36 percent.

“The majority of traders will be expecting relatively muted ranges throughout the day as we move into those Thanksgiving Holiday conditions,” said Rakuten Securities Australia in a morning note.

However, investors “will be prepared for what could be exacerbated moves if we do see any further news on the various Geo-Political issues that are so influential in the market at the moment,” according to Rakuten.

Muted movements on Wall Street

On Wall Street, the Dow Jones Industrial Average closed largely flat at 21,464.69 while the S&P 500 rose 0.3 percent to 2,649.93. The Nasdaq Composite also advanced 0.9 percent to close at 6,972.25.

To be sure, Wednesday’s moves came on a day with very low trading volume as most of Wall Street was away for the Thanksgiving holiday. The SPDR S&P 500 ETF Trust (SPY), which tracks the S&P 500, traded just over 71 million shares, well below its 30-day average volume of 130.3 million.

“Markets experienced a better night last night, but it is fair to say that sentiment remains fragile,” Daniel Gradwell from ANZ Research wrote in a morning note. “There seems a greater appreciation that with the impact of US fiscal stimulus waning, the US economy could slow like other major economies have. That leaves the market less forgiving of poor news.”

Volatility is expected to persist unless there’s a turnaround in global growth prospects, Gradwell added.

Oil prices slip after a partial recovery

Oil prices saw a recovery on Wednesday after plunging earlier in the week.

The global benchmark Brent crude futures was up 81 cents, or 1.3 percent, at $63.34 per barrel at 2:30 p.m. ET Wednesday. Brent fell to a low going back to December 2017 in the previous session.

U.S. West Texas Intermediate crudeended Wednesday’s session $1.20, or 2.3 percent higher, at $54.63. WTI hit its lowest price level since October 2017 on Tuesday.

Sentiment appeared to take a turn for the worse once again on Thursday afternoon in Asia. U.S. crude futures slipped 0.4 percent at $54.41 per barrel while Brent declined 0.33 percent at $63.27 per barrel.

U.S. crude stocks rose 4.9 million barrels last week, the Energy Information Administration said, a larger-than-expected increase. Crude inventories have risen for nine straight weeks, the longest streak of increases since March 2017.

Oil-related stocks traded mixed on the back of Thursday’s slip in crude prices.

Australia’s Origin Energy gained 2.8 percent, Woodside Petroleum advanced 0.79 percent and Santos rose 1.2 percent.

In Japan, shares of JXTG rose 2.14 percent while Fuji Oil jumped more than 7 percent. Japan Petroleum Explorationslipped into negative territory as it traded down by 1.3 percent and Inpexwas lower by 2.55 percent.

Over in South Korea, S-Oil shed its earlier gains to trade lower by about more than 1 percent and GS Holdingsdeclined by 0.77 percent. SK Innovation, on the other hand, remained higher by 0.5 percent.

China’s oil sector was also hit to a certain extent, with China Petroleum & Chemical, also known as Sinopec, slipping 0.67 percent and China Oilfield Services declining by 0.32 percent.

Vishnu Varathan, head of economics and strategy at Mizuho Bank, said in a note that the current geopolitical situation between the U.S. and Saudi Arabia is “the cat among the pigeons for the Oil market,” in reference to the ongoing dispute between the two countries over the killing of journalist Jamal Khashoggi.

“That inherently means that oil-induced volatility very much remains on the table,” he said.


The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 96.646 after seeing earlier highs above 96.8.

The Japanese yen was at 112.98 against the dollar after weakening from around the 112.7 handle yesterday. The Australian dollar traded at $0.7246 after rising from levels around $0.72 in the previous session.


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