Wednesday’s World Markets Outlook: Asia-Pacific

Australia’s main stock index fell Wednesday as prospects of a deep global recession and its impact on the demand for crude oil hammered energy stocks and offset better-than-expected trade data from China, the country’s biggest trading partner.

The benchmark S&P/ASX 200 index fell 0.3% by 0039 GMT, with a 3.4% drop in energy stocks weighing the most. If current levels hold, the energy subindex is on course for its worst day in nearly 2 wks

In New Zealand, where the government said it will unveil further fiscal stimulus this week, the main bourse jumped 3.2% to hit its highest since 12 March.

All major sub-sectors in the benchmark S&P/NZX 50 index were trading in the black

China and Hong Kong stocks fell Wednesday as investor worries over an expected sharp drop in Beijing’s first-quarter economic growth offset a brief boost from a widely expected cut to medium-term lending rates.

China’s central bank Wednesday cut the interest rate on its medium-term lending facility (MLF) for financial institutions by 20 bpts to 2.95%, a record low, in an attempt to combat the economic fallout from the coronavirus health crisis. More easing is widely expected to help struggling companies get back on their feet.

At the midday break, the Shanghai Composite index was down 0.15% at 2,823.16 points. The index briefly traded in positive territory after the MLF rate cut.

China’s blue-chip CSI300 index was down 0.28%, with its financial sector sub-index dropping 0.54%, the consumer staples sector lost 0.41%, the real estate index slipped 1.39% and the healthcare sub-index fell 0.85%.

Chinese H-shares listed in Hong Kong dropped 0.09% to 9,838.69, while the Hang Seng Index was down 0.09% at 24,412.98.

The smaller Shenzhen index was up 0.32% and the start-up board ChiNext Composite index was higher by 0.69%.

China reported fewer coronavirus cases on Wednesday but an increasing number of local transmissions in its far northeast bordering Russia remained a concern for authorities.

Most Southeast Asian stock markets edged up Wednesday after the Chinese central bank cut a Key interest rate to get its economy back on track amid fears of the worst global economic downturn since the 1930’s.

In Southeast Asia

Philippine equities led gains as they rose as much as 2.3% to hit a one-month high, with big cap financial stocks Security Bank Corporation and Bank of the Philippine Islands gaining 5.1% and 4.8%, respectively.

Malaysian equities rose for a second straight session, boosted by gains in heavyweights such as power utility Tenaga Nasional and gas processing firm Petronas Gas Bhd.

The Vietnamese benchmark rose up to 0.7%, supported by the financial sector. Joint Stock Commercial Bank for Investment and Development of Vietnam rose 1.8%.

The Thai index inched up, helped by materials stocks, but losses in the country’s prominent energy sector kept a lid on gains. Thailand’s economy is expected to lose 1.3-T baht (nearly $40-B), almost all of it in the tourism sector, as a fallout of the coronavirus pandemic, a banking association said Tuesday.

Indonesian shares lost up to 0.9%, dragged by losses in communication services stocks. PT Telekomunikasi Indonesia Tbk slumped over 2%.

Shares in Singapore were subdued.

ASIA-PACIFIC INDICES

Data as of 15 April 2020. All quotes delayed at least 15 mins.

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