Asian equities follow US stocks lower amid wild oil swing
Crude Oil whipsawedon production and stockpiles reports, while Asian stocks followed US andEuropean equities lower before an expected interest-rate hike by Federal Reserve policy makers.
WTI jumped above US$48 a barrel as a reported decline in UScrude stockpiles countered a boost in output from Saudi Arabia, reversing an earlierplunge of as much as 2.7 per cent. Brent crude is also up, above $51 a barrel.Stocks were lower from Sydney to Tokyo, while the USdollar weakened after Tuesday’s gains. Hong Kong shares pared lossesas Chinese premier Li Keqiang said Chinais pushing hard to cut financial risk and there are bright prospects forcooperation with the US The yield on 10-year Treasuries remained near 2.6 percent.
The swings in oilinterrupted the calm that’s gripped markets ahead of central bank decisions,European political drama and a raft of economic data that could set the tonefor financial markets for weeks to come. With the Fed all but certain to raiserates, investors have been weighing how oil’s precarious level and looming inflation readings could impact the central bank’s path for future moves.
Volatility isrising this week, with the VIX in the US jumping the most in a month onTuesday, while a gauge for the Nikkei 225 Index is up for a fourth straightday. Elections remain a wild card for investors. Today’s vote in the Netherlands will deliver a reading on the stateof populism in Europe as races in Franceand Germany heat up.
US trading was more muted than normal onTuesday as a late-winter storm blanketed the eastern part of the country insnow. Airlines canceled thousands of flights, wholesale power prices surged and natural gas futures gained as the storm spun up the Atlantic coast.