The major Asia-Pacific stock indexes finished mixed but mostly lower on Tuesday amid below average volume. Investors said the choppy trade was being fueled by renewed concerns over a decline in crude oil prices and position-squaring ahead of the start of the U.S. Federal Reserve’s two-day meeting. The negative developments partially offset optimism about the easing of coronavirus-related restrictions.
On Tuesday, Japan’s Nikkei 225 Index settled at 19771.19, down 12.03 or -0.06%. Hong Kong’s Hang Seng Index finished at 24575.96, up 295.82 or +1.22% and South Korea’s KOSPI Index closed at 1934.09, up 11.32 or +0.59%.
China’s Shanghai Index settled at 2810.02, down 5.47 or -0.19 and Australia’s S&P/ASX 200 Index closed at 5313.10, down 8.30 or -0.16%.
Hong Kong Shares Hit 1-Week High
Hong Kong shares on Tuesday climbed to their highest level in more than a week, as the financial hub showed some signs of returning to normalcy with civil servants set to head back into offices after the government eased lockdown restrictions.
Oil Prices Tumble During Asian Trading Hours
West Texas Intermediate (WTI) crude oil for June delivery dropped 16.59% to $10.66 per barrel. International-benchmark Brent crude oil futures also declined 5% to $18.99 per barrel. These moves were on top of Monday’s steep 24% drop in WTI and 6% dip in Brent.
The catalysts behind the weakness were intensifying fears about dwindling storage capacity worldwide. Meanwhile, new data shows the coronavirus pandemic has erased as much as a third of global demand for oil, according to some estimates.
Fed Begins Two-Day Meeting
Regional Asian stock markets see-sawed between positive and negative territory on Tuesday, amid low trading volumes as the focus shifted toward the start of the Fed’s two-day policy meeting. The Fed has already announced a raft of measures to lessen the economic blow from the coronavirus pandemic and is expected to stay on hold this week.
Recently the Fed responded to the economic slump caused by the coronavirus by slashing interest rates, buying more government debt, and taking steps to increase lending to small companies.
HSBC’s First-Quarter Profits Drop by Nearly Half as Coronavirus Hits
Asian shares dipped a little in response to an earnings report from HSBC on Tuesday that showed a 48% year-over-year plunge in pre-tax profit for the first quarter of 2020. That was worse than expectations of analysts at Morgan Stanley, who had projected profit before tax to plunge 35.7% year-over-year. Hong Kong-listed shares of Europe’s largest bank were flat on the close.