Asian Markets Pulled Back on May 16
- 8:00 AM EST: European Central Bank President Draghi speaks
- 8:30 AM EST: US building permits (April)
- 8:30 AM EST: US FOMC member Bostic speaks
- 8:30 AM EST: US housing starts
- 9:15 AM EST: US industrial production (April)
- 10:30 AM EST: US crude oil inventories
- 10:30 AM EST: European Central Bank member Praet speaks
- 6:30 PM EST: US FOMC member Bullard speaks
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China’s Shanghai Composite Index started this week on a stronger note and gained in the first two trading days of the week. However, the Shanghai Composite Index opened lower on Wednesday and declined amid the dented market sentiment.
The market sentiment weakened after North Korea warned about canceling the meeting with President Trump scheduled for next month. North Korea said that it will cancel the meeting if the US insists that it gives up its nuclear weapons in exchange for economic trade. Rising US bond yields also weakened the global market’s risk appetite and weighed on the Shanghai Composite Index. The Shanghai Composite Index closed Wednesday at 3,169.57—a drop of 0.71%. The SPDR S&P China (GXC) declined 1.7% on May 15.
After moving higher last week, Hong Kong’s Hang Seng Index started this week on a stronger note, lost strength, and declined as the week progressed. The Hang Seng Index opened lower on Wednesday following the decline of US markets overnight due to rising US Treasury yields. On May 16, the Hang Seng Index declined 0.13% and closed the day at 31,110.20. The iShares MSCI Hong Kong (EWH) declined 1.2% on Tuesday.
After briefly pulling back on Tuesday, Japan’s Nikkei Index opened lower on May 16 and declined. The weak market sentiment in the US and Asian markets weighed on the Nikkei Index on Wednesday. Weakness in the finance and investment, shipbuilding, and real estate sectors limited the market recovery. On the economic data front, according to the Ministry of Economy, Trade, and Industry, Japan’s industrial production grew 1.4% in March.
The Nikkei Index declined 0.44% and closed May 16 at 22,717.23. The iShares MSCI Japan (EWJ) declined 1.0% on Tuesday.
Next, we’ll discuss how European markets performed in the morning session on May 16.