A wave of caution swept across Asian trading floors for the second consecutive day on Friday, as investors, finding few fresh catalysts, opted for a more circumspect stance.
The initial optimism that followed recent China-US trade discussions appeared to dissipate, prompting a broad retreat in regional equities.
In early trading, Shanghai’s benchmark index was navigating lower waters, trading at 3,361.7, a decline of 19.12 points or 0.57%. Japan’s Nikkei also mirrored this sentiment, slumping 96.12 points or 0.25%.
The downward trend extended to Hong Kong, where the Hang Seng index fell to 23,234.6, shedding 218.56 points or 0.93% by 8:27 AM IST.
The mood in Tokyo was further dampened by data revealing a contraction in the country’s economy during the first quarter.
Hong Kong markets also contended with specific corporate headwinds, notably a more than 4% drop in Alibaba’s shares after the tech giant reported first-quarter results that undershot analyst expectations.
Bucking the regional trend, however, South Korea’s Kospi continued a modest upward trajectory, inching up 0.09% or 2.31 points to reach 2,623.67.
Dalal Street pauses, broader market shows resilience
The cautious tone extended to Indian shores, where benchmark indices opened lower on Friday, marking a pause after a sharp rally on Thursday.
The BSE Sensex slipped 226 points in early trade to 82,304.56.
Similarly, the NSE Nifty50 dipped 67.80 points, though it managed to maintain its position just above the psychologically significant 25,000 mark, trading at 24,994.30.
Market commentary indicated Sensex was trading below the 82,350-level shortly after the open, while Nifty50, despite an initial slip of over 40 points, held the 25,000 threshold.
Despite the retreat in the main indices, a divergent trend emerged in the broader market.
Smallcap and midcap stock indices were trading in positive territory, signaling underlying investor interest beyond the blue-chip counters.
On the Nifty50, top gainers included BEL, Adani Enterprises, Eicher Motors, Adani Ports, and NTPC.
Conversely, Bharti Airtel, IndusInd Bank, Infosys, Sun Pharma, and Power Grid Corporation were among the leading laggards.
IndusInd Bank was a notable decliner, sliding over 3% on the Nifty.
Nevertheless, market observers anticipated that mid- and small-cap segments could demonstrate continued strength throughout the session.
Oil inches up, dollar eases amid global cues
In the commodities sphere, oil prices registered a slight uptick.
This followed a dip on Thursday, buoyed by hopes for a potential breakthrough in Iran nuclear talks after former US President Donald Trump indicated progress had been made on a deal.
The US dollar, meanwhile, edged lower.
This movement came on the heels of data showing US wholesale prices rose less than anticipated last month, coupled with flat retail sales figures.
These indicators, following below-forecast consumer inflation data, fanned hopes that the Federal Reserve might consider interest rate cuts later this year.
Global market sentiment remained mixed on Thursday.
US President Donald Trump’s comments regarding the proximity of a deal on Iran’s nuclear program played a significant role in shaping investor outlook.
US stocks had mostly edged up in relatively quiet trading on Thursday, though uncertainty surrounding Mr. Trump’s trade policies continued to loom.
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