Sunday, March 26, 2023

Asian stock market plummets as Putin announces partial military mobilisation

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tiamin rice

Asian stocks closed lower on Wednesday after Russian President Vladimir Putin announced a partial military mobilization in the country, bringing geopolitical tensions to the forefront.

In a televised address, Putin said the partial mobilisation of its 2-million-strong military reserves was to defend Russian territories, claiming the West wanted to destroy Russia and did not want peace in Ukraine.

Worries about aggressive Federal Reserve policy tightening also kept investors on their toes ahead of the U.S. Federal Reserve’s much-anticipated interest-rate decision later in the day.

China’s Shanghai Composite index slipped 0.17 per cent to 3,117.18 as the Asian Development Bank cut its economic growth forecast for China and also lowered its outlook for developing Asia.

He cited the Ukraine conflict, Beijing’s COVID Zero policy and the central bank’s efforts to combat inflation.

Hong Kong’s Hang Seng index fell 1.79 per cent to 18,444.62 on Fed jitters. Japanese shares hit a two-week low as caution prevailed ahead of the Fed, BoJ and BoE meetings.

The Nikkei average closed at 1.36 per cent lower at 27,313.13, marking its lowest closing level since July 19.

The broader Topix index slipped 1.36 per cent to 1,920.80, its weakest close since Sept. 7.

Air conditioner manufacturer Daikin Industries led losses to close down nearly 4 per cent while Japan Steel Works soared 4.1 per cent in spite of the company lowering its profit forecast for the current fiscal year.

Seoul stocks fell ahead of a widely expected hefty rate hike from the U.S. Federal Reserve.

The Kospi average dropped 0.87 per cent to 2,347.21. Samsung SDI, Naver and Kakao all lost around 2 per cent.

Shipbuilder Daewoo Shipbuilding & Marine Engineering surged 8.9 per cent amid heightened anticipation that the company’s privatization would gather steam down the road.

Australian markets tumbled to hit a two-month low, with commodity-related stocks pacing the declines on fears of a global recession.

The benchmark S&P/ASX 200 index gave up 1.56 per cent to end at 6,700.20, marking its third session of fall in four.

The broader All Ordinaries index fell 1.54 per cent to 6,921.40.

Across the Tasman, New Zealand’s benchmark S&P/NZX 50 index slipped 0.62 per cent to settle at 11,498.95.

U.S. stocks fell sharply overnight, and Treasury yields surged to multi-year highs as caution gripped markets ahead of the Fed’s rate hike announcement.

Ford’s warning of big problems with supply chains and input costs also raised concerns about the earnings outlook.

The Dow and the tech-heavy Nasdaq Composite both shed around 1 per cent while the S&P 500 dropped 1.1 per cent.


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