Asian stocks mixed after oil falls, Wall Street advances

Joe Mcdonald

BEIJING (AP) – Asian stock prices were mixed yesterday after oil prices fell back and Wall Street advanced.

Benchmarks in Shanghai and Seoul advanced while Tokyo and Hong Kong slipped.

Markets steadied following a decline on Tuesday in crude prices that spiked after a weekend attack on a Saudi oil facility. The Saudi oil minister said half of production that was cut already had been restored.

“Concerns surrounding elevated oil prices have eased,” said Mizuho Bank in a report.

The Shanghai Composite Index advanced 0.3 per cent to 2,985.66 and the Kospi in South Korea picked up 0.4 per cent to 2,070.73. Tokyo’s Nikkei 225 declined 0.2 per cent to 21,960.71. Hong Kong’s Hang Seng gave up 0.2 per cent to 26,774.99 and Australia’s S&P ASX 200 shed 0.2 per cent to 6,681.60.

Investors were looking ahead to a possible decision yesterday by the United States (US) Federal Reserve to cut its benchmark interest rate by another quarter point following a reduction in July that was its first in a decade.

A man walks past an electronic stock board showing Japan’s Nikkei 225 index at a securities firm in Tokyo. PHOTO: AP

Wall Street gained after the Federal Reserve Bank of New York took the unusual step of injecting USD53 billion into markets to ease tight credit conditions that were pushing interest rates higher.

“The underlying issue is the growing scarcity of excess reserves in the system,” Chris Weston of Pepperstone Group said in a report.

Elsewhere in Asia, India’s Sensex added 0.4 per cent to 36,622.26. Taiwan advanced while New Zealand retreated.

On Wall Street, the benchmark Standard & Poor’s 500 index rose 0.3 per cent to 3,005.70. It is back to within 0.7 per cent of its record set in late July.

The Dow Jones Industrial Average rose 0.1 per cent to 27,110.80. The Nasdaq composite gained 0.4 per cent to 8,186.02.

Energy stocks slumped to give back nearly half of their huge gains from a day earlier. Rising prices for technology stocks and companies that sell to consumers made up for those losses.

Investor worries about the US-Chinese tariff war were temporarily overshadowed by the weekend attack on oil producer Saudi Aramco’s facility in Abqaiq. Yemeni rebels claimed responsibility, but US officials said they suspected Iran.

Crude surged more than 14 per cent on Monday. The attack forced Abqaiq to cut production equivalent to five per cent of the global total, but Saudi Oil Minister said it would be completely restored by the end of the month.

Yesterday, Japan’s government reported exports fell for a ninth month in August, declining 8.2 per cent in August from a year earlier.

“Exports are likely to remain weak over the coming year,” Marcel Thieliant of Capital Economics said in a report.

ENERGY: Benchmark US crude lost 42 cents to USD58.92 per barrel in electronic trading on the New York Mercantile Exchange. The contract plunged USD3.56 on Tuesday to close at USD59.34. Brent crude, used to price international oils, fell 27 cents to USD64.28 per barrel in London. It fell USD4.47 the previous session to USD64.55.

CURRENCY: The dollar gained to 108.21 yen from 108.12 yen on Monday. The euro declined to USD1.1054 from USD1.1072.