Wall Street had a mixed session, torn between Delta concerns and Fed tapering following a jump in the JOLTS job opening above 10 million and hawkish comments from Fed officials. In the end, Wall Street chose Delta hedging, rotating modestly out of growth and back to their technology happy place.
The S&P 500 eased 0.09%, the NASDAQ edged 0.16% higher, while the Dow Jones fell by 0.31%. In Asia, US futures continued to sag, all three indices down by around 0.15%.
With no firm direction from New York, Asian markets have gone their own way. The Nikkei 225 was just 0.10% higher, while an unimpressive IPO debut by Krafton has dragged the KOSPI down 0.65%. Regulatory risk and further cases of the Delta-variant in Mainland China continues to unnerve markets there. The Shanghai Composite was 0.15% lower, but the CSI 300 fell by 0.40%. Hong Kong managed to eke out a modest 0.15% gain.
Reopening day (for those vaccinated) lifted Singapore by 0.55% as markets price in a light at the end of the tunnel. Malaysia was on holiday while Taipei fell by 0.80% on China concerns, Manilla retreated 0.40%, and Jakarta was down 0.90%. Bangkok bucked the regional trend, rising 0.25%. Australian markets were trading sideways, with the ASX 200 and All Ordinaries edging 0.15% higher.
Except for Singapore, most of Asia appeared to be on virus watch and nervous about Fed tapering, with investors reducing exposures into the US CPI data tomorrow night. Europe is likely to follow the same cautious path and open slightly lower this afternoon.
I anticipate equity markets continuing this pattern with a very light data calendar until the US CPI data. As previously stated, a higher than forecast US CPI print tomorrow will negatively impact Asian equities as the threat of divergence in monetary policy paths combine with Delta worries.