Asian stocks mixed after late slump on Wall Street


People wearing face masks walk past a bank's electronic board showing the Hong Kong share index in Hong Kong, Tuesday, Nov. 23, 2021. Asian shares were mixed Tuesday after a late drop left major Wall Street indexes mostly lower. - AP

SINGAPORE, Nov 23 (AP): Asian shares were mixed on Tuesday after a late drop left major Wall Street indexes mostly lower.

Tokyo was closed Tuesday for a holiday. Hong Kong and Seoul declined while Shanghai edged higher.

Market players appeared to be relieved to learn that President Joe Biden will nominate Jerome Powell for a second four-year term at the helm of the Federal Reserve, a vote of confidence in Powell’s handling of central bank policies during the brutal disruptions caused by the coronavirus pandemic.

Hong Kong's Hang Seng fell 1.1% to 24,669.59 and the Kospi in Seoul lost 0.5% to 2,997.33. In Sydney, the S&P/ASX 200 climbed 0.8% to 7,410.60 and the Shanghai Composite index added 0.2% to 3,588.77.

Shares rose in India but fell in Taiwan.

"With Japan on holiday today, the price action in U.S. markets is being broadly repeated in Asia. Tech-heavy indices are suffering while those with more traditional resource, banking and property weightings are holding their own," Jeffrey Halley of Oanda said in a commentary.

Investors are closely watching the Fed to see whether pressure from rising inflation prompts it to speed up its plans for trimming bond purchases and raising its benchmark interest rate.

"Powell getting the nod is a sign that Biden is staying the course on monetary policy and the Fed is steadily moving toward normalizing policy,” said Brad McMillan, chief investment officer for Commonwealth Financial Network. "On the whole, the Fed is going to continue to be a force for monetary stability.”

Still, a late-afternoon burst of selling derailed the market from another all-time high on Monday.

The S&P 500 fell 0.3% to 4,682.94. The Dow gained less than 0.1% to 35,619.25. The tech-heavy Nasdaq gave up 1.3% to 15,854.76.

Small company stocks also fell. The Russell 2000 index dropped or 0.5% to 2,331.35.

Bond yields moved solidly higher on heavy selling. The yield on the 10-year Treasury rose to 1.63% from 1.54% late Friday.

Higher Treasury yields make the more expensive areas of the market, like technology stocks, less attractive, which may explain why there was more selling in stocks toward the end of the day as the bond market shifted.

With rising inflation hanging over the recovery from the pandemic, the Federal Reserve is starting to trim bond purchases that have helped keep interest rates low to support the economy and markets.

More than 55% of the stocks in the S&P 500 rose Monday, but losses by big technology and communication companies outweighed gains elsewhere in the benchmark index. Chipmaker Nvidia slid 3.1% and Netflix fell 2.9%.

Energy companies got a bump as U.S. crude oil prices rose 0.9%.

On Tuesday, US benchmark crude oil lost 83 cents to US$75.92 per barrel in electronic trading on the New York Mercantile Exchange.

Brent crude, the standard for international pricing, gave up 61 cents to US$79.09 per barrel.

The US dollar rose to 115.08 Japanese yen from 114.88 yen late Monday. The euro edged up to $1.1239 from $1.1237.

Markets in the U.S. will be closed on Thursday for the Thanksgiving holiday. They will also close early on Friday. - AP

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