EQUITIES
Hong Kong and South Korea shares led losses in Asia on Wednesday following overnight Wall Street’s negative lead.
The Hong Kong’s Hang Seng index declined 1.67% while in South Korea, the KOSPI dropped 1.46%. South Korea’s consumer sentiment index fell, standing at 96.4 for June, down 6.2 points from May’s print, according to Bank of Korea’s survey.
The mainland Shanghai Composite slipped 0.80%, and Australia’s S&P/ASX 200 was 0.60% lower.
Japan's Nikkei 225 index snapped a four-session rally on Wednesday, was down 1.12%. Investors will be looking forward to Japan’s consumer confidence data release today.
Overnight on Wall Street, all three major U.S. stock indexes closed sharply lower, with the tech-laden Nasdaq declining the most. The Nasdaq Composite slipped 3% to 11,181.54, the Dow Jones Industrial Average dropped 1.56%, to 30,946.99, and the S&P 500 declined 2.01% to 3,821.55.
With the end of the month and the second quarter two days away, the benchmark S&P 500 is on track for its biggest first-half percentage drop since 1970.
OIL
Oil prices fell slightly on Wednesday on profit taking after rising in the previous three sessions.
Losses were limited as global supply tightness underpinned the market. An overnight report suggested that Saudi Arabia and the United Arab Emirates looked unlikely to be able to lift output much. The agreement by the Group of Seven economic powers to explore ways to cap the price of Russian oil also underpinned the market sentiment.
Inventory data in the U.S. did provide some sense of improving fuel supply though. Stockpiles of gasoline for the week ending June 24 rose by 2.9 million barrels and distillate fuel supplies increased by 2.6 million barrels, according to market sources citing American Petroleum Institute figures on Tuesday. However, crude inventories fell 3.8 million barrels.
Brent crude futures fell 0.42% on the day to $117.65 a barrel. U.S. WTI crude slid 0.47%, to $111.28 a barrel, giving up earlier gains.
Both Brent and WTI rose more than 2% on Tuesday.
CURRENCIES
The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 104.517 bouncing back from below 104 earlier this week. The dollar weakened against most major peers as a decline in U.S. yields took some sheen off the currency.
The 10-year U.S. Treasury yields fell to 3.173%.
GOLD
Gold prices were hemmed into a tight range as investors were caught between pressure from prospects of higher interest rates and support from recession risks.
Spot gold was flat at $1,821.20 per ounce. US gold futures unchanged at $1,822.00.
Spot silver dipped 0.3% to $20.78 per ounce, while platinum rose 0.6% to $915.72, and palladium gained 0.8% to $1,889.46.
ECONOMIC OUTLOOK
Stocks fell across Asia on Wednesday, following a turbulent day on U.S. markets overnight, amid concerns over recession, inflation, and looming earnings season.
Wall Street tumbled in a broad sell-off overnight as dire consumer confidence data dampened investor optimism and fuelled worries that the Federal Reserve's aggressive battle against inflation could tip the economy into recession.
According to the Conference Board, the U.S. Consumer Confidence Index fell to 98.7 points in June from 103.2 in May, the lowest level seen since February 2021. The decline reinforced the view that the U.S. economy is expected to slow down going forward as consumers grapple with the high-cost environment.
Elsewhere in the region, positive sentiment was seen as China cut the quarantine period for international travellers on Tuesday, in what some observers saw as the biggest relaxation so far of its "zero Covid" strategy.
