The benchmark Nikkei 225 index rose 1.07 percent, or 203.80 points, to 19,189.39 by the break, recovering from the previous day’s sharp sell-off with dealers still hopeful Donald Trump can push through his planned tax and spending agenda despite last week’s healthcare bill collapse. / AFP PHOTO / Toshifumi KITAMURA
by Danny McCord
Agence France-Presse
Asian markets turned negative Thursday following two days of gains, but energy firms were lifted by an oil rally while the pound held up after Britain formally triggered talks to leave the European Union.
Trading floors turned red at the start of the week as Donald Trump’s failure to push through his healthcare reform fuelled worries about the prospects for his economy-boosting agenda.
Regional traders had regained some confidence since Monday, fuelled by optimism about the US economy — as data points to a healthy outlook — and the hopes the new president will eventually be able to deliver promised tax-cut and spending measures.
Greg McKenna, chief market strategist at AxiTrader, said: “It looks like the Trumponomics rally is as much about the actual improvement in the data as it is about expectations of the future in a Trumponomics world.”
But Asia was unable to press on with the recent gains Thursday. Tokyo ended 0.8 percent down, while Hong Kong slipped 0.4 percent and Shanghai lost one percent. Seoul dipped 0.1 percent while Singapore, Jakarta and Taipei also retreated. Sydney was 0.4 percent higher.
– ‘Something to cheer’ –
Energy stocks took the lead from their US counterparts after a US inventory report showed a smaller-than-expected increase in crude supplies and lower stockpiles of gasoline.
The news sent both main oil contracts around two percent higher Wednesday and they edged slightly higher in Asia trade.
Japan’s Inpex was up 0.3 percent and Origin Energy rose 0.9 percent in Sydney.
“Beleaguered oil bulls finally had something to cheer about overnight, as crude jumped over two percent following a lower than expected EIA Crude Inventory number,” Jeffrey Halley, senior market analyst at OANDA, said in a note.
The smaller-than-forecast increase, along with a supply disruption in Libya “saw buyers dip their toes into the market with vigour for the first time in two weeks”.
On currency markets the pound avoided suffering more heavy losses against the dollar and euro after sinking Wednesday following the official handover of a letter signalling Britain’s desire to leave the EU, beginning two years of divorce talks.
Sterling tumbled after Prime Minister Theresa May — whose letter had just been handed to EU President Donald Tusk — told parliament there was “no turning back” and warned there would be “consequences” for the country.
Analysts said focus for the pound-watchers would be on the EU’s declaration Tuesday on Brexit, and a summit at the end of the month.
In early European trade London and Frankfurt each rose 0.1 percent while Paris was up 0.2 percent.
– Key figures at 0800 GMT –
Tokyo – Nikkei 225: DOWN 0.8 percent at 19,063.22 (close)
Hong Kong – Hang Seng: DOWN 0.4 percent at 24,301.09 (close)
Shanghai – Composite: DOWN 1.0 percent at 3,210.24 (close)
London – FTSE 100: UP 0.1 percent at 7,381.02
Pound/dollar: DOWN at $1.2433 from $1.2440
Pound/euro: UP at 1.1555 euros from 1.1523 euros
Dollar/yen: UP at 111.20 yen from 111.04 yen
Euro/dollar: DOWN at $1.0762 from $1.0767
Oil – West Texas Intermediate: UP seven cents at $49.57 per barrel
Oil – Brent North Sea: UP seven cents at $52.49
New York – Dow: DOWN 0.2 percent at 20,659.32 (close)
dan/eb
© Agence France-Presse
