- Category: Economic
- Published Wednesday, February 17, 2016
- CTV News
TOKYO - Asian stock markets were mostly higher Wednesday as investors weighed the potential outcome of a preliminary agreement between Russia and Saudi Arabia to hold off on further increases in crude oil production, possibly alleviating a growing glut in supply.
KEEPING SCORE: Japan's Nikkei 225 slipped 0.2 per cent to 16,020.34 as investors shrugged off data showing strong machinery orders in January. Hong Kong's Hang Seng gained 0.7 per cent to 19,249.59 and the Shanghai Composite rose 0.4 per cent to 2,847.23. Australia's S&P/ASX 200 edged up 0.2 per cent to 4,919.90 and South Korea's Kospi added 0.4 per cent to 1,895.15.
OIL DEAL: A Russia-Saudi accord announced Tuesday will only take effect if other OPEC nations agree to it, and investors are not convinced they will, so U.S. crude sank after a 12-per cent rally on Friday. U.S. markets were closed on Monday. Analysts say Iran probably won't sign on because it wants to raise output following its period of sanctions. The slump in oil prices has been one factor unnerving stock markets recently as a sign of weak global demand.
ANALYST VIEWPOINT: "The accord, on face value, suggests more can and will be done over the coming months. However, the current agreement will have little impact on oil markets and there are glaring holes in what has been announced," Evan Lucas of IG said in a commentary. "The market clearly also believes that this an accord to nowhere."
WALL STREET: Shares were broadly higher Tuesday, lifted by gains in retailers and manufacturers following upbeat news from China on bank lending. Strong quarterly results gave some company stocks a boost and investors worried a bit less about China and Japan. The Dow Jones industrial average added 222.57 points, or 1.4 per cent, to 16,196.41. The Standard & Poor's 500 index rose 30.80 points, or 1.7 per cent, to 1,895.58. The Nasdaq composite climbed 98.44 points, or 2.3 per cent, to 4,435.96.
ENERGY: U.S. crude gained 27 cents to $29.31 a barrel in electronic trading on the New York Mercantile Exchange. It lost 40 cents, or 1.4 per cent, to $29.04 a barrel in New York on Tuesday. Brent crude, a benchmark for international oils, climbed 58 cents to $32.76 a barrel. On Tuesday it lost $1.21, or 3.6 per cent, to $32.18 a barrel in London.
CURRENCIES: The dollar fell to 113.89 yen from 114.23 yen the previous day. The euro rose to $1.1149 from $1.1127.