EQUITIES

Markets in Asia-Pacific were mostly higher on Thursday. The Hong Kong Hang Seng led the gains regionally, rising 2.33%, while the mainland China market also rose, with the Shanghai composite up 0.30%.

Japan’s Nikkei 225 also jumped, climbing 1.27%. Elsewhere, South Korea’s KOSPI rose 0.53%, while Australia’s ASX 200 added 0.10%. In Southeast Asia, the Singapore’s FTSE Straits Times Index rose 0.22%.

OIL

Oil prices slipped back on Thursday as investors took profits. U.S. crude and gasoline stocks rose while distillate inventories fell last week, according to market sources citing API figures on Wednesday. Crude stocks rose by 1.4 million barrels for the week ended Jan 14, while gasoline inventories rose by 3.5 million barrels, and distillate stocks fell by 1.2 million barrels.

The Brent now traded at $88.32 per barrel, and the U.S. crude futures traded at $87.18 per barrel.

Overnight, the Brent futures ends at $88.44 a barrel, while the WTI crude oil prices closed to $86.96 per barrel.

CURRENCIES

U.S. bond yields fell back slightly after shooting up earlier this week, with the 10-year retreating to 1.841% on Thursday after hitting 1.9% earlier Wednesday, and the policy-sensitive two-year yield touched 1.0449% compared with a U.S. close of 1.025%.

Germany's 10-year yield broke into positive territory for the first time since May 2019 as investors bet policymakers will curb years of stimulus to fight rising asset prices.

The pause in Treasury yields' march higher kept the U.S. dollar in check, with the dollar index which measures the greenback against six major peers at edging down to 95.535 as commodity currencies benefited from high oil prices.

GOLD

Gold prices eased on Thursday, as investors looked for clues about the Federal Reserve's interest rate hike timeline from its policy meeting next week.

Spot gold was little changed at $1,839.50 per ounce, while U.S. gold futures was down 0.21% to $1,839.40.

Spot silver slipped 0.15% at $24.19 an ounce, platinum dropped 0.37% to $1,024.60, and palladium shed 0.50% to $1,998.50.

ECONOMIC OUTLOOK

Asian share markets broke a five-day slide to edge higher on Thursday, shrugging off European and on Wall Street drops overnight as China underscored its diverging monetary and economic picture by cutting benchmark mortgage rates.

In contrast to the global move toward tighter monetary policy, China cut its mortgage reference rate for the first time in nearly two years as economic data this week showed further weakening in consumption and the troubled property sector.

The one-year loan prime rate (LPR) was lowered by 10 basis points to 3.70% from 3.80%. And the five-year LPR was reduced by 5 basis points to 4.60% from 4.65%, the first reduction since April 2020. The LPR cuts were expected after official comments called for more monetary easing to prop up the broad economy.

Stocks of Chinese property firms, which have been reeling under a debt crisis in the country, responded on the action. The Hang Seng Properties index jumped 1.84%, as Sunac surged more than 10%, while Shimao also jumped more than 10% and Country Garden topped 7%.

Tech stocks in Hong Kong also jumped, with the Hang Seng Tech index rising more than 3%. Tencent surged 4.25%, Alibaba jumped 4.35%, and Meituan soared 6%.

Concerns about rising inflation and higher rates however, still rattled the market as investors await the Fed's policy meeting next week for any changes to the central bank's plan to tackle inflation.

Geopolitical risks also remain, as the possibility of Russia invading Ukraine continue to weigh on global shares, adding to existing pressure from the rising rates outlook. U.S. President Joe Biden predicted on Wednesday that Russia will make a move on Ukraine, saying a full-scale invasion would be "a disaster for Russia" but suggesting there could be a lower cost for a "minor incursion".

Sony rose nearly 4%, after tumbling over 12% the day before after Microsoft said it was buying video game publisher Activision Blizzard for a record $68.7 billion deal for the industry.