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Asian Stock Market: RBA’s 0.25% rate hike weighs on ASX amid off in China, Japan

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  • Asia-Pacific markets remains lackluster amid holiday at major bourses.
  • RBA surpasses expectations by fueling benchmark rate to 0.35%.
  • Treasury yields remain firmer around multi-month high as traders brace for FOMC.
  • Risk-related headlines, US Factory Orders may entertain traders.

Equity markets in the Asia-Pacific region remain lackluster, despite losing a bit due to firmer yields, amid holidays in China, Japan and India on Tuesday. While portraying the mood, MSCI’s index of Asia-Pacific shares ex-Japan drops 0.17% while the benchmark Treasury yields in the US remain near the three-year high during the inactive bond markets.

Even so, the Reserve Bank of Australia’s (RBA) higher-than-expected rate lift challenges the Aussie investors and drowns the benchmark equity index, namely ASX200. Following the RBA’s 0.25% rate hike, versus 0.15% expected, the ASX 200 refreshed daily lows to extend the previous day’s losses towards the 7,300 level, down 0.45% by the press time.

Elsewhere, softer prints of New Zealand’s Building Permits for March, 5.8% versus upwardly revised 12.8% prior, couldn’t lift the NZ stocks as the NZX 50 printed 0.40% intraday losses at the latest.

The reason could be linked to the firmer yields across the board in anticipation of tighter monetary policies ahead.

Given the off in the multiple markets, coupled with a light calendar, investors are likely to wait for the Fed’s verdict and may extend the previous moves. For the intermediate directions, the US Factory Orders for March, expected at 1.1% versus -0.5% prior, maybe looked at.

Additionally, headlines from Russia and China will also be the key as Europe is all set to exert more pressure on Moscow for its Ukraine invasion whereas Beijing announced strict activity rules during the festive season amid rising covid woes.

Also read: S&P 500 Futures print mild gains tracing Wall Street moves, yields stabilize on Japan’s off