Asian stocks were mixed after U.S. indexes erased gains in the final half hour of trading, with investors adjusting their portfolios after a rally that has already added $4 trillion to the value of stocks this year.
Stocks fell at the open in Hong Kong and mainland China, while they rose in Japan and Australia. The recent advance in Chinese stock markets is likely to be tested as major financial institutions report earnings, starting with Industrial and Commercial Bank of China later on Wednesday.
Alibaba shares fell in Hong Kong after the company scrapped a $1 billion initial public offering of its logistics arm Cainiao. Chinese electric vehicle giant BYD also fell after reporting 2023 earnings that beat estimates.
US stock index
Meanwhile, Apple Inc.'s iPhone shipments in China fell about 33% in February from a year earlier, according to official data, continuing to dampen demand for the flagship device in key overseas markets.
U.S. stock futures headed for gains after the S&P 500 fell for a third day. The U.S. stock index is on track for five straight months of gains.
Japan’s Nikkei 225 is one of the few Asian stock indexes able to keep up with the US rally, up more than 20% this year and on track for one of its best quarters on record. Hong Kong’s market has yet to fully recover from its early-year slump and is expected to fall slightly in the three months to March, while Sydney is set to post modest gains.
exit stock
Investors will have to weigh up a number of variables when looking at potential end-of-month flows, which include a shorter week due to the holiday this month, according to Tony Sycamore, market analyst at IG Australia.
“Rebalancing typically involves selling in the best performing stock markets, which for March will be Korea, Germany, Japan and the US, and buying in the worst performing markets,” he wrote in a note. “More broadly, this month should theoretically see an outflow from stocks and inflow into fixed income, which has underperformed stocks.”
Treasuries were steady in Asian trading after rebounding from Tuesday's session lows following a $67 billion sale of five-year bonds. The yen fell to its lowest level of the day after a hawkish Bank of Japan board member said financial conditions would remain accommodative.
The dollar was marginally stronger against its G10 peers, while the offshore yuan was little changed after the People's Bank of China again boosted its support for the currency.
Chinese industrial companies' profits
Profits at China's industrial firms rose in the first two months of the year, extending a winning streak since August and adding to positive signs in the economy.
Cocoa futures surged above a record $10,000 per metric tonne yesterday before erasing gains, taking a breather from a historic rally that has seen prices of the key chocolate ingredient double this year.
Oil extended modest declines after an industry report pointed to a big build in U.S. inventories, and broader markets took a softer tone ahead of the quarter’s end. Gold fell but traded near a record high.
