Asian shares on Friday mostly rose after US stocks recovered toward the end of a wild trading day as governments slapped sanctions on Russia for its invasion of Ukraine.
The TAIEX on Friday closed up 57.63 points, or 0.32 percent, while Japan’s benchmark Nikkei 225 surged 1.94 percent in afternoon trading to 26,476.50.
Australia’s S&P/ASX 200 lost some of its earlier gains to close 0.10 percent higher at 6,997.80.
South Korea’s KOSPI jumped 1.05 percent to 2,676.76, Hong Kong’s Hang Seng edged down 0.29 percent to 22,824.00, while the Shanghai Composite rose 0.62 percent to 3,451.40.
All of them fell from a week earlier, with the drop 3.18 percent in Taipei, 2.38 percent for the Nikkei, 3.10 percent for the S&P/ASX 200, a 2.47 percent decline for the KOSPI, 6.16 percent for the Hang Seng and 1.13 percent for the Shanghai Composite
Japan announced additional sanctions on Russia, including freezing the assets of Russian groups, banks and individuals, and suspending exports of semiconductors and other sensitive goods to military-linked organizations in Russia.
Earlier in the week, Tokyo suspended new issuances and distribution of Russian government bonds in Japan to reduce financing opportunities for Russia.
It also banned trade with the two Ukrainian separatist regions.
While most nations in Asia rallied to support Ukraine, China denounced sanctions against Russia, saying that the US and its allies were provoking Moscow.
Despite uncertainty about the Ukraine, and worries over inflation and the COVID-19 pandemic, the turnaround on Wall Street seemed to buoy Asian shares.
“The market pivot came after the announcement of retaliatory measures toward Russia overnight, with the US implementing export controls to cut Russia off from semiconductors and other advanced technology, including software,” said Yeap Jun Rong, market strategist at IG in Singapore.
Beyond its tragic human toll, the conflict looks set to send prices even higher at gasoline pumps and grocery stores around the world as prices for oil, wheat and corn soar.
Russia and Ukraine are major producers of energy and grains, as well as other commodities.
Asian economies, already reeling from pandemic restrictions, are particularly vulnerable to rising energy costs.
Higher energy and food prices are amplifying worries about inflation, which last month was at its hottest level in the US in a couple of generations, and about what the US Federal Reserve might do to rein it in.
In Taipei, shares staged a technical rebound after heavy losses in the previous session, but the upturn was limited as investors kept a close eye on Ukraine, dealers said.
Bargain hunting focused on large-cap stocks in the tech and old economy sectors, but the most heavily weighted stock, contract chipmaker Taiwan Semiconductor Manufacturing Co (台積電), underperformed the broader market, pending the cuts in Taiwan’s weighting in the major MSCI indices after the market close.
The TAIEX closed at 17,652.18 after moving between 17,554.97 and 17,737.32.
It opened up 0.13 percent and soon rose to the day’s high as buying was sparked by a recovery on Thursday in the US.
Early selling pushed down the index to the nearest technical support at bout 17,571 points, the 120-day moving average, before buying picked up again, focusing on select semiconductor, raw material, and shipping stocks, which helped vault the main board back into positive territory by the end of the session, dealers said.
“Today’s rebound followed the US markets’ movements, as investors seemed to think that the military conflict will be confined to Russia and Ukraine, given that the United States and Europe have moved only to impose economic sanctions on Moscow,” Cathay Futures Consulting (國泰證期顧問) analyst Tsai Ming-han (蔡明翰) said. “The TAIEX’s upturn was limited, however, as the market was still watching closely how the military conflict will evolve and whether the West will bring more sanctions against Russia.”
Additional reporting by staff writer, with CNA
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