Asia report: Stocks mostly higher as oil prices rise again

Stock markets were mostly higher in Asia at the end of Wednesday, although Evergrande’s electric car division was in focus as it fell almost 11% after returning to trading.

In Japan, the Nikkei 225 was down 0.8% at 28,027.25, as the yen strengthened 0.81% on the dollar to last trade at JPY 121.89.

Technology conglomerate SoftBank Group jumped 2.33%, while among the benchmark’s other major components, automation specialist Fanuc was down 0.75% and fashion firm Fast Retailing slipped 0.24%.

The broader Topix index lost 1.21% by the end of the session in Tokyo, closing at 1,967.60.

On the mainland, the Shanghai Composite was ahead 1.96% at 3,266.60, and the smaller, technology-heavy Shenzhen Composite jumped 2.55% to 2,137.61.

South Korea’s Kospi eked out gains of 0.21% to 2,746.74, while the Hang Seng Index in Hong Kong was 1.39% higher at 22,232.03.

China Evergrande New Energy Vehicle Group plunged 10.8% in the special administrative region, however, after it resumed trading following a recent suspension.

The electric vehicle company is a division of embattled property developer China Evergrande, which remained in a trading halt implemented last week pending a regulatory release.

Reports at the time suggested the “inside information” could provide more details on Evergrande’s restructuring, coming on the back of its defaulting on several of its debts last year amid a liquidity crisis in China’s property sector.

The blue-chip technology stocks were in the green in Seoul, with Samsung Electronics up 0.09% and SK Hynix ahead 0.83%.

Oil prices were rising again at the end of the Asian day, with Brent crude futures last up 1.37% on ICE at $111.74 per barrel, and West Texas Intermediate advancing 1.87% to $106.19 on NYMEX.

Naeem Aslam, chief market analyst at AvaTrade, said volatility in oil prices took another turn as traders tried to make sense of ongoing geopolitical moves.

“Basically, on the one hand, you have good news that there is some de-escalation in geopolitical uncertainty as Russia has withdrawn some army from Kyiv.

“On the other hand, the US hasn't acknowledged this thoroughly as it is saying that Russia's dial back on its military strategy in Ukraine is minuscule.

“The issue here is sanctions on Russian energy, which has put the oil supply further out of whack.”

Aslam said that, if the US acknowledged that Russia was moving in the right direction, oil supply issues could ease off.

“But if the US stance doesn't shift significantly, we will likely see oil supply issues anchored in place.

“Traders know that if the Russian army doesn't advance further in Ukraine and begins to withdraw from Ukraine, the EU is less likely to comply with US demands.

“It is heavily dependent on Russian energy sources.”

In Australia, the S&P/ASX 200 was up 0.67% at 7,514.50, while across the Tasman Sea, New Zealand’s S&P/NZX 50 was 1.5% higher at 12,098.80.

Airlines were a mixed picture in the antipodes, with Australian flag carrier Qantas Airways up 2.14% in Sydney, while Air New Zealand was 1.79% weaker in Wellington.

The latter was put in a trading halt on the NZX an hour before the close, ahead of announcing a capital raising plan that could see it net more than NZD 1bn (£0.53bn) in funds.

Both of the down under dollars were stronger on the greenback, with the Aussie last ahead 0.08% at AUD 1.3309, and the Kiwi advancing 0.57% to NZD 1.4336.