Asian stocks higher after Wall Street declines
Asian financial markets were mostly higher Wednesday after a plunge in oil prices dragged down energy stocks on Wall Street.
KEEPING SCORE: The Shanghai Composite Index gained 0.4 percent to 3,170.19 and Tokyo's Nikkei 225 shed 0.1 percent to 20,118.25. Hong Kong's Hang Seng was unchanged at 25,694.72 and Sydney's S&P-ASX 200 added 0.6 percent to 5,698.00. Seoul's Kospi added 0.2 percent to 2,362.21 and benchmarks in Singapore, Taiwan and Jakarta also advanced. Manila and Kuala Lumpur declined.
WALL STREET: Energy stocks dived as oil dropped to its lowest price since last summer. Gains for health care and technology stocks helped reduce losses for broader market indexes. The Standard & Poor's 500 index dipped 0.1 percent to 2,435.61 and the Dow Jones industrial average fell 0.3 percent to 21,410.03. The Nasdaq composite rose 45.92, or 0.7 percent to 6,233.95. Energy stocks in the S&P 500 tumbled 1.6 percent, a day after falling 1.2 percent. They are down nearly 15 percent for the year, when the overall S&P 500 is up 8.8 percent.
OIL PRICES: The price of oil has dropped more than 20 percent this year, breaking into what traders call a bear market. On Wednesday, crude dropped for a third straight day and touched its lowest price since August on expectations supplies oil will exceed demand. That helps big consumers such as China and other Asian manufacturers but can feed concern about whether exporters will be able to pay their bills. Accelerating corporate profits have been a big reason for rise in U.S. stock prices this year, and energy companies had been forecast to provide some of the biggest gains.
ANALYST'S TAKE: "Falling oil prices continue to dampen sentiment in global macro markets," said Citigroup in a report. U.S. credit spreads are rising and concern in currency markets is increasing, they said. "Falling oil prices also hurts sentiment towards the higher-yielding emerging markets, but a steep drop in the price of oil usually spreads bearish sentiment more broadly."
ENERGY: Benchmark U.S. crude gained 6 cents to $42.59 per barrel in electronic trading on the New York Mercantile Exchange. The contract dropped 98 cents on Wednesday to close at $42.53. Brent crude, used to price international oils, advanced 5 cents to $44.87 in London. It plunged $1.20 the previous session.
CURRENCY: The dollar declined to 111.02 yen from Wednesday's 111.37 yen. The euro was little changed at $1.1169.