Asian stock markets were mixed Thursday amid worries about a U.S. rate hike and that a rally in oil prices may not be sustainable.
KEEPING SCORE: Japan’s Nikkei 225 index was up 0.3 percent to 16,811.88, but China’s Shanghai Composite lost 0.8 percent to 2,791.52, and Hong Kong’s Hang Seng index fell 0.4 percent to 20,285.90. Australia’s S&P/ASX 200 dipped 0.2 percent to 5,363.60. Stocks in Taiwan and South Korea were also down.
OIL RALLY: Benchmark U.S. crude rose another 1.9 percent to $49.56 a barrel in New York after the U.S. government reported a larger-than-expected drop in fuel stockpiles last week. Oil prices have surged sharply since earlier this year, sparking fears prices may not be sustained. It also raised anticipation of a hike in U.S. interest rates as the Federal Reserve has said it wants to keep raising rates if the economy is strong enough.
ANALYST’S QUOTE: “The remarkable over 80 percent rally in oil since earlier this year may have been overdone, as the underlying macro conditions have not change proportionally. This suggested that speculative trades have driven up the price these months, and may not be sustainable,” said Bernard Aw, a market analyst with IG in Singapore.
“The dominant theme remains Fed’s policy outlook,” said Mizuho Bank in Singapore. “A rate hike this summer is still on the table.”
WALL STREET: U.S. stocks climbed a second straight day on Wednesday, boosted by energy stocks. The Dow Jones industrial average rose 0.8 percent, to 17,851.51 and The Standard & Poor’s 500 index gained 0.7 percent to 2,090.54. The Nasdaq composite index added 0.7 percent, to 4,894.89.
CURRENCIES: The dollar rose to 110.10 yen from 109.98 yen. The euro inched up to $1.1160 from $1.1143.