Asia-Pacific markets were mixed in early trading Wednesday, after Wall Street hit more records and Australia confirmed it was in its first recession in 29 years.
Japan’s Nikkei 225 NIK, +0.28% advanced 0.2% while Hong Kong’s Hang Seng Index HSI, -0.55% slid 0.6%. The Shanghai Composite SHCOMP, -0.38% fell 0.4% while the smaller-cap Shenzhen Composite 399106, +0.18% advanced 0.2%. South Korea’s Kospi 180721, -0.10% slipped 0.2%, while benchmark indexes in Taiwan Y9999, -0.37% , Singapore STI, -0.37% and Indonesia JAKIDX, -0.00% fell. Australia’s S&P/ASX 200 XJO, +1.86% gained 1.6%.
“A positive tone had been assumed by Asia markets, finding inspiration from Wall Street with the gains notched overnight,” said Jingyi Pan, market strategist at IG in Singapore, said in a commentary. “Although the U.S. economy is nowhere near the state before the COVID-19 hit yet, these evidences of continued recovery nevertheless works in the favor of keeping the cautious optimism and the equity rally going.”
Data showed Australia’s economy shrank 7% in the second quarter, after slipping 0.3% in the previous quarter, marking its first back-to-back periods of contraction — the widely recognized signifier of recession — since 1991. The massive downturn, caused by coronavirus-related shutdowns, has been softened by record fiscal stimulus to keep businesses open and workers paid.
In other economic data, South Korea’s inflation hit a five-month high, gaining 0.7% in August, its fastest growth since March and outpacing analysts’ expectations.
On Tuesday, the S&P 500 SPX, +0.75% and Nasdaq Composite COMP, +1.39% closed at new records as encouraging economic data and dovish statements from the Fed fueled buying; tech stocks especially benefited. The Dow Jones Industrial Average DJIA, +0.75% also rose slightly.
Benchmark U.S. crude CLV20, +0.77% added 36 cents to $43.12 a barrel. It rose 15 cents to $42.76 a barrel on Tuesday. Brent crude BRNX20, +0.70% , the international standard, gained 38 cents to $45.96 a barrel.
The U.S. dollar USDJPY, +0.08% inched up to 106.07 Japanese yen from 105.97 yen.
The Associated Press contributed to this report.
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