ASIAN STOCK MARKET: TRACKS WALL STREET GAINS DURING THE WORST MONTHLY PERFORMANCE SINCE 2020

• Asia-Pacific shares print mild gains amid mixed clues during mostly quiet session.
• Markets in Japan observe Showa Day Holiday, China will also have multiple offs the next week.
• BOJ’s easing, fears that coronavirus will push for more easing in China favor buyers.
• US equities gained amid strong earnings, mixed GDP data.

Asia-Pacific equities track Wall Street gains during the mixed session on early Friday. Even so, MSCI’s index of Asia-Pacific shares ex-Japan stays on the way to post the worst monthly performance, around 7.5% MoM, since early 2020.

The market’s recent rebound could be linked to the recovery in the US shares, mainly due to the upbeat earnings and mixed US Gross Domestic Product (GDP) data for Q1 2022. Also likely to favor the corrective pullback is the absence of Japanese traders and a pullback in the US dollar.

However, firmer oil prices and looming fears of widespread covid resurgence, recently spreading in China, challenge the buyers.

On Thursday, the US Q1 2022 GDP dropped to -1.4% annualized from 6.9% prior, versus the 1.1% forecast. Additionally, the tech giants on Wall Street, like Amazon, Microsoft, Apple and Alphabet, also posted notable gains and underpin the corrective pullback in the Asian session.

It’s worth noting that China’s Politburo announced multiple measures to tame the covid outbreak in the world’s second-largest economy, which in turn seems to help the Asian buyers as well.

Amid these plays, stocks in China and New Zealand print around half a percent of daily gains while those from Australia rise 0.70%, as represented by ASX 200. Indian equities are also up by nearly 0.50% intraday whereas the S&P 500 Futures drops 0.40% at the latest.

Moving on, the preliminary readings of Eurozone GDP for Q1 2022 and the US Core Personal Consumption Expenditures Price Index for March, known as the Fed’s preferred inflation gauge, will be crucial to watch for investors.

Also read: S&P 500 rallies nearly 3.0% to reclaim 4,300 as strong Meta earnings provide much needed lift to sentiment