Asian stocks fall, trading muted with Good Friday holiday

BANGKOK – Asian stocks fell in muted trading as markets closed for Good Friday and other holidays.

Benchmarks fell in Tokyo, Seoul and Shanghai. Sydney, Manila, Bangkok and Hong Kong were among the markets observing public holidays on Friday. US and European markets were also closed.

Closures in major Chinese cities due to coronavirus outbreaks and the war in Ukraine are weighing on sentiment.

“The inflationary effects of the Russian-Ukrainian conflict are now more significant than direct military developments in a market sense. These consequences have created an uncertain environment that could keep investors wary,” Stephen Innes of SPI Asset Management said in a commentary.

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“It should be a quiet session given the Good Friday holiday,” he added.

The head of the International Monetary Fund warned on Thursday that Russia’s war on Ukraine was clouding the outlook for most countries and reiterated the danger high inflation poses to the global economy.

Japan’s benchmark Nikkei 225 fell 0.3% to end at 27,093.19. The South Korean Kospi fell 0.8% to 2,696.06. The Shanghai Composite fell 0.5% to 3,211.24.

Shares closed lower on Wall Street on Thursday as investors gave mixed views on the earnings of four of the nation’s biggest banks. The S&P 500 fell 1.2% to 4,392.59, ending a shortened trading week with a 2.1% decline.

The Dow Jones Industrial Average fell 0.3% to 34,451.23. The Nasdaq fell 2.1% to 13,351.08. Small company stocks also lost ground. The Russell 2000 fell 1% to 2,004.98.

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A quartet of big banks reported notable declines in first-quarter earnings as the latest earnings season kicks off. Market volatility and the war in Ukraine caused transactions to dry up, while a slowdown in the housing market led to fewer people looking for mortgages.

Citigroup rose 1.6% while Wells Fargo fell 4.5%. Morgan Stanley rose 0.7% and Goldman Sachs slipped 0.1%.

Bond yields rose again, pushing the 10-year Treasury yield to 2.83%.

“With higher oil prices, higher bond yields, (it) implies that the market continues to be worried about inflation, about Ukraine, about the Fed’s response to all of this,” he said. Sam Stovall, chief investment strategist at CFRA.

Tech stocks led the way lower on Thursday, reversing gains elsewhere in the market. The expensive valuations of many of the biggest tech companies give them more leverage to steer the broader market up or down. Microsoft fell 2.7%.

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Retailers and other businesses that rely on consumer spending also weighed on the market. Amazon fell 2.5%. Energy stocks rose along with the price of crude oil. Exxon Mobil rose 1.2%.

Investors once again turned their attention to the drama surrounding Tesla founder and CEO Elon Musk and Twitter. Musk offered to buy the social media company for $54.20 per share, two weeks after revealing he had accrued a 9% stake.

Musk has criticized Twitter for failing to uphold free speech principles and said in a regulatory filing that it should be turned into a private company. Twitter’s stock fell 1.7% to $45.08, well below Musk’s offer price.

Wall Street had mixed economic data to review after several hot inflation reports earlier in the week. The Commerce Department said retail sales rose 0.5% in March, boosted by higher gasoline prices as consumers continued to spend despite high inflation.

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The number of people applying for unemployment benefits rose last week, according to the Labor Department, but remained at a historic low. The data reflects a robust US labor market with near-record job openings and few layoffs.

Inflation remains at its highest level in 40 years in the United States and that forces economists and analysts to closely monitor the reaction of consumers to the rising prices of everything from food to clothing to essence.

In energy trading, benchmark U.S. crude added $2.70 to $106.95 a barrel on Thursday, closing nearly 11% higher for the week. Brent crude, the international standard, gained $2.92 to $111.70 a barrel. Markets were closed on Friday.

In currency trading, the US dollar fell from 125.89 yen to 126.65 Japanese yen. It is hovering near 20-year highs. The euro traded at $1.0815, down from $1.0832.

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