Asian Markets Head Lower On Commodity Stocks

Asian trade: The equity markets remained driven by fear and risk-aversion in tonight’s Asian session. Asian markets fell for a fourth day, driven lower by commodity stocks and automakers.

The strong selling from the commodity markets has taken its toll on the world’s financial markets. Commodity stocks lead the declines tonight, as a large part of the companies’ profit is directly connected to the price of raw materials. Carmakers continued to tumble, as it seems the economy would stay in a contraction phase longer than expected, delaying even more the industry’s comeback.

In addition, the yen’s rise in the last few days might have affected in a negative yen, which tumbled tonight in the Japanese markets. Some investors foresee a very poor earnings season in Asia this year, as demand has taken a strong plunge in Europe and U.S., the preferred markets for the local exporters. The Nikkei fell 380.32 points (4.30%) to 8,456.48, after yesterday the stock market was closed for business. The Australian S&P/Asx fell 41.20 points (1.12%) to 3,642.10.

Crude oil tumbled substantially in the last day of trading, despite the Gaza conflict. Crude oil for February delivery fell $0.30 to $37.20.

Gold posted some small gains, after plunging the day before. Bullion for immediate delivery gained $3.10 to $826.10.

Previous Wall Street trade: At the close of floor trading on the NYSE, the DOW was at 8473.97 after falling 125.21 points (-1.46%). The S&P was at 870.26, down 20.09 points (-2.26%) while the NASDAQ had moved to 1538.79 with a loss of 32.80 points (-2.09%). Bonds were bought as equities sold off; the yield on the 2-year note fell 2.34 basis points to 0.7385% while yield on the benchmark 10-year note fell 7.3 basis points to 2.307%. The dollar had gains of 0.80% on the euro, 2.31% on the pound and 3.07% against Australia's dollar as it fell 1.29% to the yen.

Previous European trade: In Europe, the U.K. Ftse fell $22.35 points (-0.50%) to 4,426.19, while the German Dax lost $64.27 points (-1.34%) to 4,719.62.