Singapore On Thursday, Asia-Pacific stocks were mixed as oil prices fell dramatically.
International benchmark Brent crude prices sank 3.48 percent to $109.50 per barrel during Asian trade hours. Crude futures in the United States fell 4.23 percent to $103.26 a barrel.
According to NBC News, US President Joe Biden’s administration is considering releasing 1 million barrels of oil per day from the strategic petroleum reserve for around six months. Since Russia’s invasion of Ukraine more than a month ago, global oil prices have risen sharply in a turbulent market.
“The problems we’re witnessing with Russia are medium- to long-term in nature, and sadly, an SPR release is simply a temporary fix,” said Warren Peterson, ING’s head of commodities strategy. “In the end, these quantities would fall short of the Russian disruptions we’re witnessing as a result of self-sanctioning, so the market would stay tight.”
Meanwhile, Rachel Ziemba of Ziemba Insights said she’d be on the lookout for messages about supplies being refilled.
“The issue of what the messaging is about how it’s going to be refilled comes up again.” Otherwise, it’ll just appear like a… short-term political maneuver, which I believe will backfire,” Ziemba, the firm’s founder, told CNBC’s “Street Signs Asia” on Thursday.
In broader Asia-Pacific markets, mainland Chinese equities fell 0.44 percent to 3,252.20, while the Shenzhen component fell 1.187 percent to 12,118.25.
According to official figures issued on Thursday, industry activity in China decreased in March. The country’s official manufacturing Purchasing Managers’ Index fell to 49.5 in March, down from 50.2 in February.
The 50-point mark in PMI measurements distinguishes between expansion and recession. The PMI is a monthly indicator that shows how much the economy has grown or shrunk in the previous month.
China’s factories were impacted harder in the first quarter than last year, according to an independent survey by China Beige Book. China has also been dealing with its most acute Covid-19 epidemic since the pandemic began in recent weeks.
In a Thursday report, Zhiwei Zhang, chief economist at Pinpoint Asset Management, said, “The Omicron breakouts in several Chinese cities led to lockdowns and disruption of industrial activity.” He predicted that economic activity will decrease even further in April, citing a Shanghai lockdown that began in late March.
“The lockdown policy is effective in limiting breakouts in the short term,” Zhang added, “but the economic consequences in the long run could be enormous.”
The Hang Seng index in Hong Kong lost 0.66 percent in the final hour of trading. Baidu’s stock in the city dropped more than 3% after the company was added to a list of firms that could be delisted from US exchanges by the Securities and Exchange Commission.
In other news, Japan’s Nikkei 225 index down 0.73 percent to 27,821.43, while the Topix index fell 1.08 percent to 1,946.40. The Kospi in South Korea rose 0.4 percent to 2,757.65 at the end of the trading day.
Meanwhile, Australia’s S&P/ASX 200 index fell 0.2 percent to 7,499.60.
Outside of Japan, MSCI’s broadest index of Asia-Pacific stocks fell 0.44 percent.
The dollar index, which measures the value of the greenback against a british pound, was at 97.787 as it tries to rebound from earlier this week’s lows of above 99.
The Japanese yen was trading at 121.45 per dollar, still higher than earlier this week’s highs of 124 against the greenback. The Australian dollar was trading at $0.7477, having mostly traded in a range of $0.747 to $0.753 this week.