Tokyo
Asian shares rose Wednesday, following a rally on Wall Street led by technology companies, although investors remain concerned about the war in Ukraine and inflation. Benchmarks were higher across the Asian region, despite worries about rising energy costs. Oil prices rose, while the dollar gained against the Japanese yen.
Investors were also closely watching what might happen with President Joe Biden joining a NATO meeting and EU Summit Thursday in Europe, where sanctions and the Russian oil embargo will likely top the agenda.
Ukrainian President Volodymyr Zelenskyy was set to make a much anticipated online speech in Japan’s parliament.
Japan, which has abided by a pacifist constitution after its defeat in World War II, has taken an unusually vocal position on the war in Ukraine, joining in sanctions against Russia alongside the Western nations.
Japan’s benchmark Nikkei 225 surged 2.7% in morning trading to 27,947.26. Australia’s S&P/ASX 200 added 0.5% to 7,374.10. South Korea’s Kospi gained 0.7% to 2,730.13. Hong Kong’s Hang Seng jumped 2.4% to 22,410.06, while the Shanghai Composite rose 0.5% to 3,274.69.
With few levers remaining to pressure Russia short of military intervention, the market is beginning to price in the loss of a significant amount of Russian oil needing to be backfilled. “It could take years for Russian oil markets to normalise, if ever,” said Stephen Innes, managing partner at SPI Asset Management.
Bond yields rose sharply for the second day in a row, reflecting expectations of more aggressive interest rate hikes by the Federal Reserve as the central bank moves to squelch the highest inflation in decades.The yield on the 10-year Treasury climbed Wednesday to 2.41% from 2.30% late Monday. The yield, which influences interest rates on mortgages and other consumer loans, was at 2.14% late Friday.
