On Tuesday, Asia-Pacific markets saw shares lower for the most part, even though they had had a strong start to the week. This was after investors were digesting the minutes of the meeting of the Australian central bank.
The Hang Seng index in Hong Kong saw a drop of 0.43%, while the final hour of trading saw the Hang Seng Tech index come down by 0.88%. The Australian S&P/ASX 200 index also fell by 0.56%, which saw it close the day at 6,649.6.
The markets in South Korea and mainland China appeared to be mixed for the day. The Shanghai Composite recorded mild gains to reach a value of 3,279.43, while there was a 0.3% fall in the Shenzhen Component, which brought it to 12,494.77.
There was also a 0.18% drop in the Kospi index in South Korea, which brought it to 2,370.97. Meanwhile, a 0.72% gain was recorded in the Kosdaq index that leading it to 782.33. Since the Japanese markets opened for trading after a holiday on Monday, they managed to buck the region-wide trend on Tuesday.
There was a 0.65% gain in the Japanese Nikkei 225 index that taking it to 26,961.68, while the Topix index also rose by 0.54% to end the day at 1,902.79. The MSCI’s index of shares in the Asia-Pacific region, excluding Japan, fell by 0.35%.
The Australian situation
On Tuesday, the Reserve Bank of Australia also released the minutes of its monetary policy meeting. They showed that the board thinks that the current interest rate in the country is below the neutral rate. This suggests that there would need to be further hikes in the interest rate in order to bring inflation back to the central bank’s target rate.
Earlier this month, the RBA announced an interest rate hike of 50 basis points. The minutes of the meeting said that the interest rate level was still significantly low for an economy that is dealing with high inflation and a very tight labor market.
There was a rise in the Australian dollar, as it climbed to $0.6859.
On Monday, all major indexes in the Asia-Pacific region had recorded gains of more than 1%. The Hong Kong index had been leading gains with a 2.7% rise for the day. However, the uncertainty around the pace of inflation and the actions of the US Federal Reserve to combat it is leading to problems. Therefore, analysts predicted that market volatility would persist for some time.
As far as company news is concerned, reports indicated that SoftBank had decided to pause its plans for listing chip maker Arm in the UK because of the political uncertainty in the country. There was a 1.42% rise in the shares of the SoftBank Group.
US indexes had also rallied earlier in the session, but they had pulled back and ended the day lower. A 0.69% drop was recorded in the Dow Jones Industrial Average, while 0.84% and 0.81% fall was seen in the S&P 500 and the Nasdaq Composite, respectively.