Asian Stock Market: Nikkei plunges as yen turns volatile, DXY firms, oil below $90.00

• Asian indices have been cornered by a dismal market mood on escalating Russia-Ukraine tensions.
• Japanese equities have been hit by the weakening yen as firms may display weak EBITDA margins.
• Oil prices have surrendered the $90.00 support amid soaring hawkish Fed bets.

Markets in the Asian domain are displaying mixed performance as Nikkie225 has plunged while Chinese stocks are trading flat. Risk-perceived assets have turned extremely volatile as 10-year US Treasury yields have recaptured the psychological hurdle of 4% and are gearing up to recapture the ultimate hurdle of 4.02%.

At the press time, Japan’s Nikkei225 plunged 2.50%, ChinaA50 traded almost flat, and Hang Seng tumbled 1.37%.

The US dollar index (DXY) has refreshed its weekly high at 113.40 as the risk-off market prospect has forced the market participants to hide behind the safe-haven appeal. Escalating Russia-Ukraine tensions after the Ukrainian military damaged the Crimea Bridge in Russia has renewed issues of supply chain bottlenecks in Europe. This may infuse fresh blood into the Eurozone inflation structure.

Meanwhile, Japanese equities are witnessing an intense sell-off as yen has cracked to near the prior Bank of Japan (BOJ) intervention area. Earlier, the BOJ intervene in the currency market to provide a cushion against a one-sided fall. It looks like the impact has faded now and currency is gearing for a further decline.

The Japanese firms are set to deliver their third quarter result season of CY2022. More weakness in yen will force the institutions to downgrade the operating margins of firms depending on imported inputs.

On the oil front, oil prices have surrendered the round-level support of $90.00 as upbeat US Nonfarm Payrolls (NFP) data has accelerated the odds of a bigger rate hike by the Federal Reserve (Fed). Investors are awaiting the release of the US inflation data, which will provide more clarity over the likely monetary policy action by the Fed. A bigger-than-projected inflation rate will escalate chances for an extreme hawkish Fed and eventually will trim economic projections.