Asian Stocks Down as Investors Remain Concerned Over Geopolitical Risks in Europe
2022.07.21 05:41
By Doris Yu
Investing.com – Asia Pacific stocks were mostly down on Thursday morning as investors assessed signals from corporate earnings. Europe’s geopolitical risks remain a focus for investors.
Japan’s Nikkei 225 inched down 0.06% by 10:26 PM ET (2:26 AM GMT). The Bank of Japan is due to release its interest rate decision on Thursday.
South Korea’s KOSPI was up 0.43%.
In Australia, the ASX 200 inched down 0.02%.
Hong Kong’s Hang Seng Index fell 1.04%.
China’s Shanghai Composite was down 0.42% while the Shenzhen Component edged down 0.16%. U.S. President Joe Biden said a call with China’s President Xi Jinping is due “within the next 10 days.”
The dollar held gains, while the euro steadied after sliding as Italian Prime Minister Mario Draghi’s resignation would plunge the country into months of political turmoil.
The European Central Bank is expected to raise interest rates by 25 basis points, the first time that it hikes rates in more than a decade. The ECB will also unveil its new crisis management tool.
Investors are concerned whether equities have reached a trough after this year’s selloff amid China’s economic slowdown and the war in Ukraine. They are also weighing signals from the latest corporate earnings to get a clue on how companies are managing amid the highest inflation in generations and escalating borrowing costs.
Many stocks “are still in very distinct downtrends so you can see a rally off maybe an oversold level but really if you are not starting to recover and break into a better uptrend it really remains to be seen if this can continue,” Cameron Dawson, NewEdge Wealth chief investment officer, told Reuters. “So it’s more a relief at this point and not necessarily a trend change.”
Across the Atlantic, Russian President Vladimir Putin signaled Gazprom PJSC (OTC:OGZPY) is poised to restart gas exports to Europe on Thursday through its Nord Stream pipeline which is scheduled to reopen following maintenance. But Putin warned that flows will be tightly curbed unless a spat over sanctioned parts is resolved.
