Optimism was in the air on Monday as investors looked toward a slew of economic reports that will be released later this week, including minutes from the U.S. Federal Open Market Committee (FOMC). The People’s Bank of China also held its 1-year and 5-year prime loan rates steady, which was well anticipated by markets – encouraging Asian markets to rally. Below is an overview of what transpired across Asia’s major exchanges today:
Biggest Asian Markets Started Week With Increases
At the close of trading, China’s CSI 300 index, which tracks stocks of the major firms listed in Shanghai and Shenzhen, rose 2.45%. This led to large gains throughout Asian markets; The Shenzhen Component jumped 2.03%, while the Shanghai Composite soared by a remarkable 2.06%. Additionally, Hong Kong’s Hang Seng Index increased by 0.85%, followed closely behind by its Tech index at 1.32%. In South Korea, however, defense stocks traded lower after North Korean missiles were fired into their eastern waters; nevertheless, the Kospi still ended with a slight rise at 2453.15.
Japan’s Nikkei 225 was slightly up at 27,531.94, and the Topix concluded 0.39% higher at 1,999.71 as investors anticipated for Bank of Japan Governor Kazuo Ueda to appear in parliament on Friday. The S&P/ASX 200 closed just above 7,351.5, expecting minutes from the Reserve Bank of Australia meeting to be released Tuesday. On Wall Street, stocks ended mixed – Dow Jones Industrial Average managed a gain exceeding 100 points while both S&P 500 and Nasdaq Composite dropped; however, US markets will remain shut for Presidents’ day, honoring George Washington’s birth anniversary celebrated annually on the third Monday in February.
China’s Oil Demands Could Further Fuel the Increase in Asian Market
According to Vanda Insights, the oil market is searching for quantifiable evidence that China’s demand for fuel has reverted back to pre-pandemic levels. Founder Vandana Hari expects a full recovery by mid-year thanks to mobility data depicting increased travel activities. She stated: “It’s already noticeable through high-frequency movement records since, after three years, Chinese citizens are traveling both domestically and internationally.” With this substantial rise in transportation around the country, oil prices look set to reach their original level soon!
Andy Lipow, the president of Lipow Oil Associates, declared that a resurgence in Chinese demand will make global markets heavily reliant on OPEC+ for heightened oil production. He further highlighted his concern that OPEC may be unable to respond adequately and promptly. At present, Brent crude futures have risen by 0.49% to $83.41 per barrel, while U.S West Texas Intermediate futures increased by 0.45%, reaching $76.68 a barrel respectively.
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