Fed Hikes Rates See Asian Markets Mixed


Asian stock markets are mixed on Thursday as investors digested the potential impact of the U.S. Federal Reserve's first interest rate increase this year and as worries about a trade war between the U.S. and China also weighed on investor sentiment. Energy and resources stocks advanced on higher crude oil and metal prices.

The Australian market is declining following the modest losses overnight on Wall Street and as investors digested weaker-than-expected Australian employment data. Nevertheless, higher crude oil and metal prices lifted resources stocks.

In late-morning trades, the S&P/ASX 200 Index is losing 17.50 points or 0.29 percent to 5,932.80, off a low of 5,909.10 earlier. The broader All Ordinaries Index is down 15.20 points or 0.25 percent to 6,037.90.

The big four banks - ANZ Banking, Commonwealth Bank, Westpac and National Australia Bank - are lower in a range of 0.7 percent to 1.4 percent.

The major miners are rising on strong base metals prices. BHP Billiton is advancing more than 2 percent, Rio Tinto is adding almost 2 percent and Fortescue Metals is up 0.5 percent.

Oil stocks are also advancing after crude oil prices rose to a six-week high overnight. Woodside Petroleum is rising almost 2 percent, Santos is higher by more than 1 percent and Oil Search is adding 0.3 percent.

Gold miners are mixed even as gold prices gained. Evolution Mining is down 0.5 percent, while Newcrest Mining is rising 0.6 percent.

Washington Soul Pattinson reported a nearly 2 percent decline in first-half profit despite a 26 percent increase in revenues, while underlying profit rose 19 percent. The investment firm's shares are adding 0.5 percent.

Sigma Healthcare's full-year underlying profit fell more than 10 percent and sales were broad flat with last year, while net profit rose more than 3 percent. The pharmacies and drug supplier's shares are losing more than 5 percent.

On the economic front, the Australian Bureau of Statistics said that the jobless rate in Australia came in at a seasonally adjusted 5.6 percent in February. That was above expectations for 5.5 percent, which would have been unchanged from the January reading.

The Australian economy added 18,000 jobs last month - shy of expectations for the addition of 20,000 jobs following the 16,000-job increase in the previous month.

In the currency market, the Australian dollar rose against the U.S. dollar on Thursday. The local unit was trading at US$0.7731, up from US$0.7696 on Wednesday.

The Japanese market is advancing after a weak start following the negative cues overnight from Wall Street as the U.S. Federal Reserve raised interest rates for the first time this year.

Shares of exporters are rising despite a stronger yen, while oil stocks also gained on higher crude oil prices.

In late-morning trades, the benchmark Nikkei 225 Index is rising 183.66 points or 0.86 percent to 21,564.63, off a low of 21,349.71 in early trades. The Japanese market was closed on Wednesday for the Vernal Equinox.

In the oil space, Inpex is gaining more than 4 percent and Japan Petroleum Exploration is higher by almost 5 percent after crude oil prices rose to a six-week high overnight.

The major exporters are also higher. Sony is rising more than 2 percent, Canon is advancing almost 2 percent, Mitsubishi Electric is higher by more than 1 percent and Panasonic is adding almost 1 percent.

Among the major automakers, Toyota is adding 0.3 percent, while Honda is declining 0.2 percent. In the banking sector, Mitsubishi UFJ Financial is losing almost 1 percent and Sumitomo Mitsui Financial is down more than 1 percent.

Among the market's best performers, Komatsu, Chughai Pharmaceutical, Hitachi Construction Machinery and Tokai Carbon are all rising more than 3 percent each.

On the flip side, Daiichi Sankyo is losing more than 4 percent, Japan Steel Works is down more than 3 percent and DeNA Co. is lower by almost 3 percent.

In economic news, the latest survey from Nikkei revealed that the manufacturing sector in Japan continued to expand in March, albeit at a slower pace with a manufacturing PMI score of 53.2.

That's down from 54.1 in February, although it remains above the boom-or-bust line of 50 that separates expansion from contraction.

Japan will also see January results for its all industry activity index, and February figures for supermarket and department store sales today.

In the currency market, the U.S. dollar is trading in the upper 105 yen-range on Thursday.

Elsewhere in Asia, Singapore, Shanghai, New Zealand and Hong Kong are also lower, while South Korea, Indonesia, Malaysia and Taiwan are higher.

On Wall Street, stocks closed modestly lower on Wednesday after the Federal Reserve announced its widely anticipated decision to raise interest rates by 25 basis points and continued to project three rate hikes in 2018.

The Dow edged down 44.96 points or 0.2 percent to 24,682.31, the Nasdaq slipped 19.02 points or 0.3 percent to 7,345.29 and the S&P 500 dipped 5.01 points or 0.2 percent to 2,711.93.

The major European markets ended mixed on Wednesday. While the German DAX Index closed just above the unchanged line, the French CAC 40 Index edged down by 0.2 percent and the U.K.'s FTSE 100 Index dipped by 0.3 percent.

Crude oil prices rose Wednesday after the government confirmed a surprise drop in U.S. oil inventories. May WTI oil gained $1.63 or 2.6 percent to settle at $65.17 a barrel on the New York Mercantile Exchange, the highest since early February.