Home ›› 09 Nov 2022 ›› Stock
Asian and European stock markets traded mixed Tuesday in jittery deals as Americans head to the polls in critical midterm elections.
The dollar clawed back some of its recent losses versus the euro, while oil continued to be weighed down by weaker Chinese demand expectations.
Frankfurt stocks gained ground after overnight Wall Street gains, but Paris flatlined and London slid in value.
Those US midterm elections today might keep investors on the sidelines a bit before they make any major decisions, noted Markets.com analyst Neil Wilson.
Hong Kong and Shanghai sank as speculation about a rollback of China's strict zero-Covid policies fuelled market volatility, even after Beijing vowed to stick with its harsh lockdowns and testing regimes.
On the upside, Tokyo stocks won 1.3 per cent.
Polls opened Tuesday in crucial US elections that could decide the political future of both President Joe Biden and his predecessor Donald Trump -- who has all but announced he will seek the White House again in 2024.
Biden's Democrats are facing a gargantuan struggle to hang on to Congress, after a race the president has cast as a defining moment for US democracy -- while Trump's Republicans have campaigned hard on kitchen-table issues like inflation and crime.
Polls show Republicans are likely to win at least one house of Congress -- and some see the prospect of further Washington gridlock as a scenario that lessens the risk of policy uncertainty.
Consensus is that investors prefer political deadlock as it prevents any significant shifts in policy, added Scope Markets analyst James Hughes.
With that looking like a real possibility, the real market turbulence may appear later in the week.
US on inflation watch
On Monday, US stocks climbed, with the Dow Jones Industrial Average finishing up 1.3 per cent and the broad-based S&P 500 rising 1.0 per cent.
The next major data point that investors are watching is US inflation data due on Thursday.
SPI Asset Management analyst Stephen Innes said the data will be the next marker for the (Federal Reserve) on how high to take interest rates.
Back in Asia, Hong Kong closed down 0.2 per cent after jumping nearly three per cent in the previous session as investors continued to hope for a relaxation of China's strict Covid-19 rules.
Speculation about reopening continues to add some market volatility, said Taylor Nugent, an economist at National Australia Bank.
In a timely reminder of the potential for Covid policy to hit output, Apple warned iPhone shipments will be lower than previously expected after China lockdowns affected operations at a supplier's factory, he noted.
