Asia-Pacific markets opened mixed on Tuesday as weakness on Wall Street overnight continued to weigh on sentiment, with investors extending their rotation out of artificial intelligence-related stocks.
By around 11:45 am AEDT, Australia’s S&P/ASX 200 was trading 0.2% higher, Japan’s Nikkei 225 fell 1%, while South Korea’s Kospi 200 declined 1.9%.
Local economic data in Australia showed a sharp pullback in consumer confidence. The Westpac–Melbourne Institute Consumer Sentiment Index fell 9% in December to 94.5, down from 103.8 in November.
Ryan Wells, an economist at Westpac Group, said the latest reading reversed last month’s improvement. “After a surprising bounce in November – which resulted in the first ‘net positive’ reading since reopening from the pandemic – confidence has fallen back to around the levels that prevailed just prior,” he said.
Wells added that while the index has been volatile in recent months, it ended the year in “cautiously pessimistic” territory.
Additionally, fresh PMI data from S&P Global pointed to softer momentum in Australia’s private sector, with the Flash Australia Services PMI Business Activity Index easing to 51.0 in December from 52.8 in November, marking the slowest expansion in seven months.
The Flash Australia Manufacturing PMI improved to 52.2 from 51.6.
In Japan, S&P Global data showed a modest improvement in overall activity.
The Flash Japan Services PMI Business Activity Index edged down to 52.5 in December from 53.2 in November, while the Flash Japan Manufacturing PMI rose to 49.7 from 48.7, remaining in contractionary territory despite the improvement.
Overnight in the United States, major equity benchmarks finished lower. The Dow Jones Industrial Average slipped 0.1%, the S&P 500 fell 0.2%, and the Nasdaq Composite declined 0.6%, as losses in large-cap AI names continued to weigh on technology stocks.
Commodity markets were mixed. Brent crude oil fell 0.9% to settle at an eight-week low of US$60.56 per barrel.
Spot gold added 0.1% to trade near record highs at around US$4,304.91 per ounce.
In Asia, mainland Chinese equities weakened on Monday, with the Shanghai Composite down 0.6% at 3,867.9 and the CSI 300 also falling 0.6% to 4,552.1.
Hong Kong’s Hang Seng Index declined 1.3% to 25,628.9, while India’s BSE Sensex edged 0.1% lower to 85,213.4.
European markets provided a brighter lead, closing higher on Monday. London’s FTSE 100 rose 1.1% to 9,751.3, Germany’s DAX added 0.2% to 24,229.9, and France’s CAC 40 climbed 0.7% to 8,124.9.
