October 31, 2023 (MLN): Asian stocks were mixed Tuesday, with traders tracking developments in the Middle East crisis as Israel presses on with its ground incursion of Gaza, while hopes the conflict will not spill over regionally kept oil prices subdued, APP reported.
Attention is also on meetings by major central banks, with Japan reported to be considering a tweak to its yield control policy, while observers expect the Federal Reserve to hold interest rates.
There is a sense of relief on trading floors that the Israel-Hamas conflict has been contained so far, with optimism growing that other regional players will not get involved.
Israel's intensifying land and air campaign since Hamas's October 7 attacks has heightened fears for the 2.4 million civilians trapped inside Gaza, where the Hamas-ruled health ministry says more than 8,300 have died.
Tel Aviv says more than 1,400 people, mainly civilians, were killed, with more than 230 people taken hostage.
With worries about supplies from the crude-rich Middle East subsiding for now, both main oil contracts edged up slightly Tuesday.
However, the mood was a little less cheery on equity markets, even after a rally on Wall Street.
Data showing China's factory sector activity shrank in October weighed on sentiment, dragging on Hong Kong and Shanghai, while there were also losses in Seoul, Manila and Jakarta.
Tokyo was slightly lower ahead of the Bank of Japan's decision, with speculation swirling that it is talking about further relaxing its yield curve control (YCC), in which it allows bond yields to move within a tight band.
That has helped keep monetary policy ultra-loose as the BoJ tries to stimulate the economy, though with the Fed pushing borrowing costs to two-decade highs the yen has tumbled this year.
The Japanese unit was slightly lower in Asian trade, having bounced on Monday.
Policy normalisation, to the extent it reverses the recent yen weakness, is a negative for Japanese stocks," said Chamath de Silva, of BetaShares Holdings.
"The Japanese market is particularly exporter heavy, hence a lot of yen sensitivity." Chamath de Silva added.
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Posted on: 2023-10-31T09:41:11+05:00
