Asia report: Markets lose post-Brexit momentum
Markets in Asia lost some of their drive on Thursday, after a turnaround Tuesday and a winning Wednesday in the unstable wake of last week’s Brexit vote.
AUD/USD
$0.6533
23:03 26/04/24
GBP/NZD
NZD2.1025
23:53 26/04/24
Hang Seng
17,651.15
10:20 26/04/24
Nikkei 225
37,934.76
09:44 26/04/24
USD/JPY
¥158.3270
01:54 27/04/24
Japan’s Nikkei 225 closed almost flat, adding 0.06% to 15,575.92, giving up early gains of almost 1%.
The yen was last 0.04% stronger at JPY 102.79.
Shares in Mitsubishi Heavy finished up 3.59% after Daiwa Securities raised its rating on the stock to outperform.
The stock appears undervalued, said analyst Hirosuke Tai, adding he expects operating profit growth despite the recent and ongoing appreciation of the yen.
Markets on the mainland were relatively muted, with the Shanghai Composite Index losing 0.07% to 2,929.61, and the Shenzhen Composite also more or less flat at 1,974.23.
In South Korea, the Kospi finished up 0.72% to 1,970.35, while Hong Kong’s Hang Seng Index added 1.75% in an afternoon surge to 20,794.37.
Shares in Seoul’s Hyundai Motor were down 2.52% by the close, after Hyundai Heavy and Hyundai Samho Heavy sold shares in the carmaker to raise KRW 226.1bn.
Hyundai Heavy shares were up 0.48%.
Analysts were saying the post-Brexit recovery rally suggested the UK’s political crisis was of diminishing importance to the global markets, although uncertainty over what shape the country’s exit from the EU might take was still looming large.
“[The] Brexit threat will only become real if UK actually goes through with the invocation of Article 50, and it appears that this will not be the case for the time being,” said BK Asset Management managing director of foreign exchange strategy Boris Schlossberg.
“Although markets remain wary and cognizant of the existential risk of Brexit, as long the Article 50 is not invoked, further downside risk appears to be limited.”
Despite the rallies around the globe, investors were still clamouring for safe havens, with bond yields heading lower for another session.
Oil prices dropped during Asian trading, with Brent crude last down 1.06% to $50.08 and West Texas Intermediate losing 1.07% to $49.35 per barrel.
In Australia, the S&P/ASX 200 was up 1.77% at 5,233.40, with the energy, financial and materials subindexes all surging by more than 1%.
New Zealand’s S&P/NZX 50 added 1.4% to close at 6,897.52, and was now well above the levels it saw in the days immediately before the Brexit vote.
The down under dollars were mixed, with the Aussie last 0.16% weaker against the greenback at AUD 1.3441 and the Kiwi 0.01% stronger at NZD 1.4060.