Asian market rally fizzles on oil price retreat

 30 Dec 2015 - 9:41

Asian market rally fizzles on oil price retreat

Tokyo: Most major Asia-Pacific stock markets turned lower Wednesday after a brief morning rally, as another slump in oil prices dented buying sentiment.

The reversal came after Wall Street and European markets rose Tuesday, bolstered by a brief rebound in crude prices and a positive reading on US consumer confidence as the year draws to a close.

"Risk sentiment is very much subject to crude oil prices," Hiroyuki Yamamuro, an analyst at Ueda Harlow, told Bloomberg News.

Hong Kong's Hang Seng index was down 0.46 percent by midday, while Shanghai lost early gains to slip 0.07 percent.

Seoul lost 0.27 percent, Singapore was down 0.40 percent and Taiwan fell 0.26 percent.

However, Japanese shares started their final 2015 trading session on a positive note, putting Tokyo on track to be among the world's best-performing major markets this year.

At the break, the benchmark Nikkei 225 index rose 0.33 percent.

The country's financial markets will close Thursday and reopen on January 4 after the New Year's holiday.

Meanwhile, Sydney added 1.04 percent in afternoon trade.

"We'll keep on being moved by the oil price. We'll have to keep being aware of this for the first three months or the first half of next year as well," said Chihiro Ohta, general manager of investment information at SMBC Nikko Securities.

The mixed picture in Asia followed a tech-driven rally on Wall Street, where improving crude prices and upbeat US data lifted the mood.

Amazon closed at a new record of $693.97, up 2.8 percent, rising for a second day after Monday announcing record holiday sales of its premium delivery service.

Analysts also pointed to support from a three percent gain in US oil prices. That continued a trend in much of December that has seen US equities move in tandem with swings in crude rates.

Meanwhile, the US Conference Board's index of consumer confidence rose to 96.5 in December from 92.6 the prior month.

The report offered an upbeat view on the world's top economy following the Fed's interest rate hike announcement this month.

The Dow jumped 1.10 percent Tuesday, while the S&P 500 gained 1.06 percent and the Nasdaq ended 1.33 percent higher. European equities also rose.

In Asia, commodity-linked firms advanced on Tuesday's gains in oil prices. Japanese energy explorer Inpex rose 0.33 percent by the lunch break and Sydney-listed Woodside was up 1.55 percent.