Daily market review

United States

Equities edged up to end near flatline Wednesday as investors found the latest minutes from the Federal Open Market Committee less hawkish than feared. The Dow Jones industrial average declined 0.2 percent, the S&P 500 firmed 0.1 percent, and the NASDAQ eased 0.1 percent.

Earlier, equity indexes slipped as concern resumed over actual conflict in Ukraine after Western officials warned that Russia was continuing to build up forces at the Ukraine border and diplomatic efforts remained stalled.

Energy stocks outperformed as markets braced for energy supply disruptions. Precious metals and industrial metals were strong on the Ukraine trade, along with defensive sectors including utilities and real estate.

On the downside, software and internet stocks lagged. Roblox, the video game firm, down 26 percent, and Shopify, the ecommerce firm, slipped 16 percent on earnings disappointments.

Airbnb, the lodging service, gained 3.7 percent on strong results and better guidance. On the downside, Wynn Resorts slipped 2.1 percent on an earnings miss.

These price data reflect observations at 4:00 PM US ET: Dated Brent spot crude oil dropped US$1.16 to US$92.02 while spot gold rose US$20.36 to US$1,872.43. The US dollar fell vs. most major currencies. Yields on the US Treasury 30-year bond declined 2 basis points to 2.34 percent and the 10-year note fell 1 basis point to 2.04 percent.


Equities were narrowly mixed with risk appetite diminished after US and NATO officials said Russia was still increasing its forces around Ukraine. The Europe-wide STOXX 600 edged up 0.1 percent, the German DAX eased 0.3 percent, the French CAC slipped 0.2 percent, and the UK FTSE 100 was down 0.1 percent.

More strong economic data, including US retail sales and UK inflation figures, kept investors focused on prospects for higher interest rates, another negative. On the other hand, Bank of France Governor Francois Villeroy de Galhau repeated that the European Central Bank is in no rush to remove policy accommodation. Oil & gas and precious metals prices bounced back as the market renewed its concern over possible supply if the Ukraine conflict heats up.

Among sectors, real estate, oil & gas, basic resources, chemicals, and construction & materials outperformed while lagging were telecom, banks, media, autos & parts, personal & household goods, financial services, retail, and technology.

Among companies in focus, Heineken gained 2.6 percent and Air Liquide rose 3.0 percent on better-than-expected results while Ahold Delhaize slipped 7.1 percent on a disappointing quarter. In telecom, Ericsson fell 14 percent after reporting compliance trouble.

Asia Pacific

Asia/Pacific markets tracked US markets higher Wednesday with support from apparent easing in Ukraine-Russia tensions and supportive comments from People's Bank of China Governor Yi Gang.

Yi said the PBOC "will keep our accommodative monetary policy flexible and appropriate, and increase support for key areas and weak links in the economy," in a videotaped speech before the Group of 20 meeting starting Thursday in Jakarta. A softer-than-expected Chinese producer prices report, with a year-on-year rise of 9.1 percent, added to expectations of PBOC support.

Japan's markets outperformed, with the Nikkei 225 rising 2.2 percent and the wider TOPIX index up 1.7 percent. Banks, automakers, shipping stocks, and pharma led the winners. Among companies in focus, Bridgestone, the auto parts giant, rose 7.4 percent, and Asahi, the drinks group, gained 4.9 percent after earnings beats.

China's CSI 300 index rose 0.4 percent and the value-stock heavy Shanghai composite gained 0.6 percent. Among sectors, real estate outperformed while technology shares lagged. Hong Kong's Hang Seng index popped up 1.5 percent, with tech stocks leading and real estate investment trusts lagged.

The Taiwan Taiex gained 1.6 percent and the South Korean KOSPI rallied 2.0 percent with tech stocks leading, including Taiwan Semiconductor, up 2.1 percent. Indian equities seesawed lower with the BSE Sensex off 0.3 percent amid weakness in banking, autos, and metals stocks.

Recovering risk appetite on perceived easing in the Ukraine crisis lifted Australian equities with the All Ordinaries index up 1.1 percent. Strong earnings added to the gains. Best sectors were health care, real estate investment trusts, consumer staples, consumer discretionary, and industrials.

Looking ahead*

In Asia/Pacific, Japanese merchandise trade, Japanese machinery orders, Australian Labour Force Survey, and Singapore merchandise trade reports are scheduled. In Europe, Swiss merchandise trade and Italian merchandise trade reports are due. In North America, US housing starts & permits, US jobless claims and Philadelphia Fed manufacturing index are on tap.

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