Shares in Asia-Pacific were mixed in Monday trade, trying to find footing following a brutal week of selling last week. European stocks also are expected to open mixed today.
South Korea's KOSPI led losses among the region’s major markets as it fell more than 2%, hitting its lowest levels since November 2020. The Nikkei 225 in Japan traded 0.74% lower, and Australia’s S&P/ASX 200 dipped 0.64%.
The Shanghai Composite in mainland China sat mildly lower, while the Hong Kong’s Hang Seng index climbed 0.21%. The Singapore’s FTSE Straits Times Index rose 0.06%.
Oil prices rose on Monday in volatile trade, reversing earlier losses, as investors refocused on tight supplies, though sentiment was still fragile amid concerns about slowing global economic growth and fuel demand.
Brent crude futures gained 20 cents, or 0.2%, to $113.32 a barrel, and U.S. WTI crude was at $109.55 a barrel, down one cent after rising more than $1 in early morning deals.
The dollar index slipped to 104.440, after reaching a two-decade high at 105.79 mid last week. The greenback lost ground against most other major currencies as investors continued to assess the risks to the economy from tighter monetary policy following the Federal Reserve's biggest rate increase in a quarter of a century.
Investors also monitored market reaction to the release of China’s latest benchmark lending rates. The one-year loan prime rate (LPR) was kept at 3.70%, and the five-year LPR was unchanged at 4.45%. China stood pat on its benchmark lending rates for corporate and household loans, as expected on Monday, with global central banks' rate increases making it tough for Beijing to stimulate a weak domestic economy by lowering rates.
Cryptocurrency bitcoin remained weak, sliding 2.5% to $20,041.30, back toward last week's low of $17,592.78, a level not seen since late 2020.
Gold gains slightly on Monday as muted U.S. dollar supported on bullion demand, and as the U.S. market holiday expected to lead to thin trading during the day.
Spot gold was flat at $1,841.10 per ounce, and U.S. gold futures rose 0.14% at $1,843.10.
Spot silver fell 0.7% to $21.49 per ounce and platinum dipped 0.8% to $934.34, while palladium rose 0.8% to US$1,830.81.
Shares were mixed on Monday after a tumultuous trading week last week. Investors’ sentiment turned sour on concerns that major central banks will have to tighten so aggressively to contain runaway inflation that they will tip the world into recession.
The cautious open today comes on the back of central bank action last week. The U.S. Federal Reserve raised its benchmark funds rate by 75 basis points, its largest hike since 1994, before the Swiss National Bank surprised markets with its first hike since 2007 and the Bank of England implemented its fifth rate rise in a row.
The ECB meanwhile held an emergency meeting, announced that it plans to create a new tool to tackle the risk of euro zone fragmentation, a move aimed at assuaging fears of a fresh debt crisis for the common currency bloc.
Investors will strap in for more interest rate reality on the calendar this week, with Federal Reserve Chairman Jerome Powell due to testify before Congress and expected to reiterate the need to combat inflation through aggressive rate hikes.
On the data front this week in the U.S. include updates on the PMI, existing home sales, initial jobless claims, and the University of Michigan reading on consumer sentiment and the Michigan consumer sentiment survey.