Asia report: Stocks mostly down after spicy US inflation report
By Josh White
Date: Thursday 13 Jan 2022
(Sharecast News) - Equity markets closed mostly lower in Asia on Thursday, after fresh data out of the US overnight showed consumer prices rising even faster in December.
In Japan, the Nikkei 225 was down 0.96% at 28,489.13, as the yen strengthened 0.07% against the dollar to last trade at JPY 114.56.
The retail sector was under particular pressure in Japan, with Uniqlo owner Fast Retailing off 1.92%, and Seven & i Holdings - which operates the global 7-Eleven convenience nameplate - slid 3.28%.
Elsewhere on the benchmark board, robotics specialist Fanuc was down 2.39% and technology giant SoftBank Group was 2.06% weaker.
The broader Topix index was off 0.68% by the end of trading in Tokyo, settling at 2,005.58.
On the mainland, the Shanghai Composite slid 1.17% to 3,555.26, and the smaller, technology-centric Shenzhen Composite lost 1.65% to 2,434.92.
South Korea's Kospi slipped 0.35% to 2,962.09, while the Hang Seng Index in Hong Kong eked out gains of 0.11% to 24,429.77.
The property sector was again in focus in the special administrative region, with developer Sunac plunging 22.63% after it announced plans to sell 452 million new shares at HKD 10 apiece to a new controlling shareholder, Sunac International Investment Holdings.
The exercise, set to raise HKD 4.52bn, would see half of the proceeds being used to repay loans, with the rest for general corporate capital.
Cruise operator Genting Hong Kong, meanwhile, plummeted 56.16% after the company returned to trading from a four-day halt.
In a regulatory filing, the company said it could not guarantee it "will be able to meet its financial obligations as and when they fall due".
Seoul's blue-chip technology stocks were in a mixed state, with Samsung Electronics down 1.27%, while SK Hynix gained 0.78%.
Sentiment was dented at the start of the Asian session after fresh data out of the United States overnight showed inflation rising even faster in December.
Consumer prices rose 7% in December, making for a new highest level since 1982, leading to renewed expectations that the Federal Reserve will soon begin hiking interest rates.
Despite the data, stocks still finished Wednesday's session above the waterline on Wall Street.
"Markets initially offered a calm reaction to the hot report with Wall Street closing modestly higher on Wednesday," said FXTM senior research analyst Lukman Otunuga.
"The most notable price action was seen in FX markets, with the king dollar breaking down as Treasury yields pulled back, while gold bugs were injected with renewed confidence.
"The December CPI report has presented further evidence of persistent price pressures, especially with inflation registering its biggest annual gain since 1982."
Otunuga said that as expectations over the Fed raising interest rates as soon as March intensified, the sentiment could weigh more heavily on global stocks, while supporting the dollar and Treasury yields in the medium term.
"Given how markets remain sensitive to comments from Fed officials, today could see more volatility with numerous Fed speakers on the roster."
Oil prices were lower as the region went to bed, with Brent crude last down 0.02% at $84.65 per barrel, and West Texas Intermediate losing 0.1% to $82.56.
In Australia, the S&P/ASX 200 managed gains of 0.48% to 7,474.40, while across the Tasman Sea, New Zealand's S&P/NZX 50 squeezed ahead 0.18% to 12,826.99.
The down under dollars were both stronger on the greenback, with the Aussie last head 0.32% at AUD 1.3685, and the Kiwi advancing 0.44% to NZD 1.4540.
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