Jolliness may not be in the cards for markets in the last week before Christmas.
Asia’s shares may not climb the wall of geopolitical worry on Monday, with negative cues from Wall Street on Friday as well as futures suggesting Japan’s Nikkei 225 index would extend losses.
“So far this holiday season, Santa has only delivered a bag of bother: Brexit impasse, European political mess, a global growth sinkhole and Trump legal issues, to name a few,” Stephen Innes, head of Asia Pacific trading at OANDA, said in a note on Monday.
“The synchronised global growth slowdown continues to gather weight with China’s weaker consumption data confirming the extent to which it is being felt in China. Poor PMI’s in Europe and a horrendous GDP print in Australia amidst a Sydney housing market meltdown suggest no country is immune to the global economic downturn,” he added.
Other signs also pointed to concerns over market direction.
The Bank of International Settlements (BIS), which is an “umbrella group” for central banks, said in its quarterly review that recent global market ructions would probably be extended amid an adjustment to tighter monetary conditions as policy is normalized after a decade of extraordinarily low interest rates and flush liquidity, according to a Reuters report.
March futures for Japan’s Nikkei 225 index were up 20 points at 21,285 at 7:34 A.M. SGT, according to CME data; that compared with the index’s close at 21,374.83, down 2.02 percent, on Friday.
Singapore’s Straits Times Index ended Friday down 1.09 percent at 3077.09; December futures for the index were at 3073 on Friday, while January and February futures were at 3075 and 3078 respectively, according to SGX data.
Hong Kong’s Hang Seng Index fell 1.62 percent to 26,094.789 on Friday, while China’s CSI 300 shed 1.67 percent to 3165.911.
Malaysia’s KLCI index fell 0.84 percent to 1661.96 on Friday, while Indonesia’s IDX Composite shed 0.13 percent to 6169.84.
The Dow Jones Industrial Average dropped 2.02 percent to 24,100.51 on Friday, the Nasdaq Composite shed 2.26 percent to 6910.66 and the S&P 500 lost 1.91 percent to 2599.95. Futures for the three indexes were a tad lower in early trade.
Nymex WTI crude oil futures for January were up 0.33 percent at US$51.37 a barrel at 7:15 A.M. SGT, while ICE Brent crude oil futures for February were up 0.17 percent at US$60.38 a barrel at 7:18 A.M. SGT, according to Bloomberg data.