NEW YORK: Most Asian stocks retreated on low volumes after a risk-off session on Wall Street, with investors monitoring continued volatility in energy markets and further signs that companies are finding it hard to provide outlooks. Oil in London tumbled to the lowest in more than 18 years, reported Bloomberg.
Shares fell from Sydney to Hong Kong though declines were shallower than those in the U.S. on Tuesday. Equities in Shanghai slipped, while European stock futures advanced. S&P 500 contracts were little changed after the gauge closed down more than 3%, with investors shrugging off a deal reached by the White House and congressional leaders on fresh spending to combat the impact of the coronavirus pandemic. Brent crude oil prices tumbled as the global benchmark was sucked into the rout that sent U.S. futures below zero for the first time ever this week. The yield on benchmark 10-year Treasuries was steady after dropping below 0.6%.
The oil debacle may signal the hit to the global economy will be far worse than anticipated by investors who sent the S&P 500 up 28% from its March lows. While major economies around the world take tentative steps toward reopening, signs the U.S. is close to bolstering spending did little to offset fresh concerns over the depth of the recession.
Corporate earnings added to woes. Deep profit declines often come with no company insight into the remainder of the year and mounting signs that capital investment is set to plunge. Still, Netflix shares rose after the close of regular trading when the company said it added nearly twice as many subscribers as predicted in the first quarter. Chipotle withdrew its earnings guidance.
“There’s no way you can predict earnings right now,” Michael Cuggino, portfolio manager at Pacific Heights Asset Management LLC, said on Bloomberg TV. “It’s virtually impossible until we have more visibility with respect to how to world comes out of the coronavirus on the other side.”
President Donald Trump said his administration is working on a plan to make money available to the oil industry to prevent the loss of jobs after prices plunged.
Elsewhere, the Australian dollar rose as better-than-expected retail sales data triggered the unwinding of some short positions.
These are the main moves in markets:
Stocks
- Futures on the S&P 500 added 0.3% as of 1:08 p.m. in Tokyo. The gauge declined 3.1% on Tuesday.
- Japan’s Topix index fell 0.7%.
- Hong Kong’s Hang Seng declined 0.6%.
- The Shanghai Composite declined 0.2%.
- South Korea’s Kospi index lost 0.8%.
- Australia’s S&P/ASX 200 Index dropped 0.3%.
- Euro Stoxx 50 futures added 0.5%.
Currencies
- The yen was at 107.78 per dollar, little changed.
- The offshore yuan was at 7.1005 per dollar.
- The euro bought $1.0858.
- The Aussie rose 0.6% to 63.15 U.S. cents.
Bonds
- The yield on 10-year Treasuries fell two basis points to 0.55%.
- Australia’s 10-year yield dipped one basis point to 0.84%.
Commodities
- West Texas Intermediate crude for June delivery fell 4.5% to $11.05 a barrel.
- Brent crude futures fell 13% to $16.83 a barrel.
- Gold was at $1,683 an ounce, down 0.2%.
