Following the decline of Wall Street, Asian markets showed a mixed performance on Thursday. Concurrently, oil prices surged more than $2 after U.S. President Donald Trump announced sanctions against Russian oil giants.
The sanctions against Russian companies
On Thursday, EU leaders convened a summit with plans to approve additional sanctions against Russia and advance a proposal to use frozen Russian assets in Europe to fund Ukraine's war efforts and economic needs for at least the next two years.
The U.S. benchmark crude oil price rose by $2.02 to $60.52 per barrel, while international benchmark Brent crude increased by $2.09 to $64.68 per barrel.
Despite reports that the U.S. may tighten restrictions on the export of products made with American software to China, the Hang Seng Index in Hong Kong rose by 0.6%, closing at 25,824.32 points, while the Shanghai Composite Index slightly increased by 0.1% to 3,917.89 points.
Reports indicate that Japanese Prime Minister Sanae Takaichi is preparing an economic stimulus plan exceeding last year's amount of approximately 14 trillion yen (about $920 billion), which contributed to a nearly 1.4% drop in the Nikkei 225 Index, closing at 48,939.69 points. SoftBank Group led the decline, announcing plans to issue bonds denominated in dollars and euros to finance its investments in artificial intelligence, resulting in a drop of over 4% in its stock price.
Takaichi also stated her support for maintaining interest rates at the current near-zero level, contributing to the depreciation of the yen. On Thursday, the dollar rose against the yen from 151.94 yen to 152.52 yen.
The Kospi index in South Korea fell by 1%, closing at 3,845.56 points as investors remained cautious due to limited progress in U.S.-Korea trade negotiations.
The S&P/ASX 200 index in Australia saw a slight gain of less than 0.1%, closing at 9,032.80 points.
The Taiwan Weighted Index fell by 0.4%, while the BSE Sensex in India gained by 0.9%.
On Wednesday, the S&P 500 index in the U.S. fell by 0.5%, closing at 6,699.40 points; the Dow Jones Industrial Average dropped 0.7% from its record high, closing at 46,590.41 points; and the Nasdaq Composite Index declined by 0.9%, closing at 22,740.40 points.
Netflix dragged the market lower after reporting quarterly profits below analyst expectations. The video streaming company and many others are being pressured to achieve robust profit growth, which may counter criticisms that their stock prices have risen too high since the S&P 500 rebounded 35% from its April lows.
Reports from Capital One Financial and Western Alliance Bancorp exceeded analyst expectations, leading to a 1.5% increase in Capital One's stock and a 3.2% rise in Western Alliance's shares. The report from Western Alliance was particularly reassuring, given that the bank had previously raised market concerns about potential risks (it was among several banks warning of possible bad loans, potentially linked to fraud).
Additionally, Beyond Meat experienced extreme volatility in its stock price on Wednesday. The company's shares soared 112% in early trading but gave back all gains, ultimately closing down 1.1%. However, under the momentum of meme stocks, Beyond Meat's stock has seen an overall increase of 454.5% this week.
As of Tuesday, this plant-based meat producer was the most held stock in the Roundhill Meme Stock Exchange-Traded Fund (ETF). Stocks in such ETFs tend to attract significant investor interest, as many aim to capitalize on rising prices while largely ignoring the operational performance or business nature of the companies involved.
In other trading on Thursday morning, gold prices rebounded by about 1.6% to $4,131.80 per ounce after falling for two consecutive days from historical highs.