Asian shares mixed; Japan’s first quarter GDP data release – Le Grand Plateau

SINGAPORE – Shares in the Asia-Pacific region were mixed Wednesday morning after comments by US Federal Reserve Chairman Jerome Powell, who said he intends to raise rates until inflation eases.

Japan’s Nikkei 225 rose 0.7%, while the Topix rose 0.67%.

Japan’s economy contracted 1% year-on-year in January-March compared to the previous quarter, government data showed on Wednesday. That’s less than the 1.8% decline predicted in one poll, according to Reuters.

The markets had a great rally last night, and a lot of that is because we’ve had about six straight weeks of weekly losses since the start of the year, we have our biggest tech deficit since 2006, and we have our biggest equity deficit since May. 2020.

Kelvin Tai

Regional Investment Director, UBS Global Wealth Management

Elsewhere, mainland Chinese stocks fell, with the Shanghai Composite down 0.15% and the Shenzhen Component down. The Hang Seng Index in Hong Kong also fell 0.42%.

The South Korean Kospi rose 0.1%. Australian stocks also gained as the S&P/ASX 200 edged up 0.8%.

The broadest Asia-Pacific MSCI stock index outside of Japan rose 0.33%.

US Federal Reserve Chairman Jerome Powell said he would support raising interest rates until prices start to fall to normal levels. Earlier in May, the US central bank raised rates by half a percentage point, the biggest hike in two decades, as it seeks to fight inflation.

Overnight on Wall Street, the S&P 500 jumped 2.02% to 4,088.85, while the high-tech Nasdaq Composite jumped 2.76% to 11,984.52. The Dow Jones Industrial Average added 431.17 points, or 1.34%, to 32,654.59.

“There was a big rally in the markets last night, and a lot of that was because… since the start of the year, we’ve had about six straight weeks of weekly losses, we have our biggest tech deficit since 2006, and we have our biggest equity deficit. since. May 2020,” Calvin Tay, Regional Chief Investment Officer at UBS Global Wealth Management, told CNBC’s Squawk Box Asia.

“The market is actually on the cusp of a rally, but the big question is: is this a bearish rally or is it a sustainable rally? Tai said. “I think the rally will be hard to sustain given that as you know you will also have QE in the next couple of weeks. »

Currency and oil

The US dollar index, which tracks the dollar against a basket of its peers, was at 103,285 after recently falling from levels above 104.

The Japanese yen traded at 129.11 per dollar after holding above the 129 level against the US dollar for most of the week. The Australian dollar changed hands at $0.7012, still above the sub-$0.70 levels seen earlier this week.

Oil prices rose in the morning hours of trading in Asia: futures for international benchmark Brent crude rose 0.6% to $112.60 per barrel. US oil futures rose 1.01% to $113.54 a barrel.

Correction: This article has been updated to accurately reflect the Asia-Pacific market moves on Wednesday, an earlier version incorrectly listed the day on one occasion.

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