Chinese oil falling… Asian stock exchanges are trading in the red zone

Chinese oil falling: Today was negative for many financial instruments,
as oil retreated and Asian stock exchanges followed it.

Today seemed to be “red” in Asia.

Evest is following up with you on all developments in global markets.

Oil is retreating because of “China”

Today, West Texas Intermediate crude price fell by 1.4% to record $ 60.64 a barrel,
while Brent crude fell by 1.13% to reach $ 63.69 a barrel.

Markets are worried about weak demand in China as the operating growth of domestic factories fell to its lowest level in 9 months.

Refiners have become more cautious about importing as this is the time for a weak demand this year.

This is not the only cause but domestic profit margins have not been catching up with the sharp increase in international reference prices yet.

As it is expected, more than 10 maintenance plants during the period between March and June 2021.

China’s demand for oil may slow as they may have enough oil for use in the near future.

Chinese inventories are near to reach maximum levels.

So, many are feeling anxious that this will negatively affect prices.

However, the drop was limited thanks to positive euphoria over the US fiscal stimulus package,
as the United States House of Representatives approved the $ 1.9 trillion relief plan
which was proposed by President Joe Biden last Saturday.

In addition, Johnson & Johnson’s vaccine has been approved in the United States.

This by its turn leads to an increase in prospects for a future demand recovery.

Strong gains in US markets

Coronavirus’s large aid package which has approached the US economy as well as calm down in bond markets
secured strong gains on US stock exchanges on Monday.

In addition, strong sentiment and economic data were boosted, as sentiment picked up,
supported by the US industry’s surprisingly strong recovery in February.

ISM PMI reached its highest level in 3 years.

In addition, construction investments significantly increased by more-than-expected during January.

The world’s most famous index, Dow Jones Industrial Average closed rising by 1.95% to record 31,535.51 points.

Nasdaq 100 index of heavy technology stocks rose by 2.98% to reach 13,282.95 points.

DAX is retreating in pre-trade valuations

After a short return above the mark of 14,000 points at the beginning of the week,
it appears that the DAX index has stopped rising again.

IG the leading German index was assessed by down 0.44% to 13,951 points,
on Tuesday, about 2 hours before starting trading.

Chinese and Japanese stock exchanges are hedged by losses

After the large recovery at the beginning of the week,
investors in Asia’s most important exchanges became more cautious again on Tuesday.

Stock exchanges in East Asia and Australia showed more sharp changes in general trend on Tuesday.

After starting in a positive area-supported by US good targets- indicators are in red during late trading.

According to Reuters, analysts said:
“It seems that Asian markets are taking a breather this morning after they started global recovery of stocks yesterday,
and profit-taking may be a reason for this”.

Japan

The leading Japanese Nikkei 225 index declined by 0.9% to record 29,408 points,
as Japanese investors valued many of the Japanese released figures.

The unemployment rate in Japan was stable at 2.9% in January as it was in December, which is better than expected at 3%.

The percentage of available jobs for seekers of work rose to record 1.10 in January compared to 1.5 in December.

This means that there were about 110 available jobs for every 100 seekers of jobs.

Japanese corporate capital expenditure numbers retreated by a rate of 4.8%, in the fourth quarter, year-on-year during 2020.

They were worse than the expected decline of 2% but better than their 10.6% decline during the third quarter.

Excluding software components, capital spending decreased by 6.1% year-on-year,
which is worse than estimated by – 3%, but it is recovering from the previous decline, which is equivalent to – 11.6%.

In the fourth quarter of 2020

In the fourth quarter of 2020, Japanese corporate profits also fell by 0.7%, year-on-year.

This is better than the decline of – 28.4% during the third quarter.

Corporate sales fell by 4.5%, year-on-year.

This was better than their decline at a rate of – 11.5%, during the previous quarter.

CSI-300 index

CSI-300 index which includes the largest 300 companies listed on mainland China stock exchanges,
recently retreated by about 2%.

The banking regulator stressed a number of risks,
such as a strong influx of capital coming from abroad and a bubble of the real estate sector.

As a result, this could make the Chinese central bank adopt a more restrictive monetary policy,
according to observers.

Hong Kong

In Hong Kong, Hang Seng Index fell by 1.4%.

Australian stock exchange also closed in red area as it fell by 0.4%, after rising at a rate of 1%, in some stages.

The fact that the country’s Central Bank left interest rates unchanged did not provide any momentum,
as this was also expected, and stocks were actually hoping to release more monetary stimulus.

Australia

Governor Phillip Lowe, head of the Australian Central Bank, indicated that economic recovery is progressing well
and that expansion is occurring more quickly than initially expected.

At the same time, RBA indicated that “significant progress” in employment is still needed as well as a much stronger wage increase than what is currently needed.

On other hand, Kospi rose by 07%, and it flew away alone after the government reported that factory production jumped by 7.5% during January,
beating estimates and it accelerated from 2.5% during December.