Asian stocks rangebound before China reopening

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Asian equity benchmarks are little changed in early trade as traders await the reopening of China from a long holiday break. Mainland markets look poised to gain as Beijing’s supportive policy stance adds impetus to a budding bullish momentum.

Australia’s share index edged higher after the S&P 500 gained 1.3% Friday when softer-than-expected US jobs data revived bets the Federal Reserve will cut interest rates this year. A gauge of Chinese shares listed on the Nasdaq rose 5.5% last week. Japanese markets are closed for a holiday.

Global stocks rose last week as risk sentiment improved. US Treasuries rallied as the payrolls release, and a cooldown in wages appeased investors worrying about “stagflation” or a recession. Instead, the print gave fodder to the believers in an economy that is gradually slowing and would allow a data-dependent Fed to start easing policy later this year.

Oil rose in early trading after Israel closed the Kerem Shalom humanitarian crossing into Gaza on Sunday following a rocket barrage fired by Hamas, in an incident that could derail weeks-long delicate hostage and cease-fire negotiations. Saudi Arabia lifted the price it sells crude to Asia as it attempts to tighten the oil market.

Traders will also be mindful of a swath of central bank meetings this week, led by a likely hawkish Reserve Bank of Australia on Tuesday following stronger-than-expected inflation data last month. Chinese activity data as well as inflation readings in key emerging markets are also due.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow