Asia report: Negativity abounds as oil stocks fall across region
Markets in Asia mostly finished in negative territory on Wednesday, with sentiment affected by a further fall in oil prices.
In Japan, the Nikkei 225 managed gains of 0.16% to 21,846.48, as the yen weakened 0.07% against the dollar to last trade at JPY 113.89.
The broader Topix index also went against the regional trend in Tokyo, adding 0.17% to close at 1,641.26.
Oil stocks were under pressure amid the global price decline, however, with Inpex off 1.86%, Japan Petroleum Exploration down 2.13%, and JXTG declining 2.59%.
On the mainland, the Shanghai Composite was down 0.85% at 2,632.24, and the smaller, technology-heavy Shenzhen Composite was 0.4% weaker at 1,378.36.
Fresh economic data out of China showed the country’s industrial output improved 5.9% year-on-year in October, which was ahead of Reuters-polled forecasts.
On the fixed asset investment front, the official reading also beat expectations at 5.7% growth, while retail sales missed what market watchers were looking for, with the measure showing 8.6% growth over the same month in 2017.
South Korea’s Kospi was off 0.15% at 2,068.05, while the Hang Seng Index in Hong Kong slid 0.54% to 25,654.43.
Among the oil companies on the Korean peninsula, S-Oil fell 5.32% and SK Innovation weakened 3.25% alongside their peers across the region.
Oil prices extended their declines during from Tuesday during the Asian session, and made it more than 12 sessions in a row that crude has been below the waterline.
On Monday, Saudi Arabian energy minister Khalid al-Falih said that the OPEC cartel of oil producing countries and its partners had agreed to the need to slash supply in 2019 by around a million barrels per day, in a bid to raise prices.
Responding to that, US president Donald Trump said on Tuesday that he did not want to see such moves, calling higher oil prices a bad thing for economic growth.
“Oil prices have dropped sharply since peaking in early October as oversupply concerns have deepened,” noted Commonwealth Bank of Australia mining and energy analyst.
It wasn’t all sour news, however, with crude staging a small recovery as the region went to bed - Brent crude was last up 1.19% at $66.26 per barrel and West Texas Intermediate managed to climb 1.08% to $56.30.
In Australia, the S&P/ASX 200 fell 1.74% to settle at 5,732.80, with oil plays showing declines across the sector.
Beach Energy was down 5%, Santos fell 5.02%, and Woodside Petroleum was off 2.49%.
Across the Tasman Sea, New Zealand’s S&P/NZX 50 was 0.4% lower at 8,827.74, led lower by express parcel firm Freightways, which slid 6.2%.
Both of the down under dollars were stronger on the greenback, with the Aussie last ahead 0.07% at AUD 1.3842, and the Kiwi advancing 0.39% to NZD 1.4725.