Asian Stock Market: S&P 500 Futures, China’s Evergrande entertain bears amid tepid sentiment

• Asia-Pacific markets traded mixed, mostly bearish, as investors await the key US data/events.
• Omicron fears ebb but Evergrande keeps weighing on the Asian market sentiment.
• Yields signal Fed’s hawkish path but US data, FOMC Minutes eyed for now.

Asian shares remain on the back foot during early Wednesday, despite mixed concerns and an absence of major data/events. The reason could be linked to the fears emanating from China and the Fed’s next move ahead the US ADP Employment Change for December and FOMC Minutes.

With the Chinese policymakers’ readiness to arrest yuan gains battling sustained financial tensions relating to the struggled real-estate firm Evergrande, markets in Beijing print losses of late. Adding to the bearish bias was the heavy sell-off by the technology shares in Wall Street, led by strong US Treasury yields.

Alternatively, receding fears of the South African covid variant, namely Omicron and recently downbeat US data, not to forget hopes of a faster recovery in Asia-Pacific than the West, keeps investors hopeful.

That said, the MSCI’s index of Asia-Pacific shares ex-Japan drops around 1.0% whereas Japan’s Nikkei 225 consolidates the previous day’s gains heading into the European session. That said, Australia’s ASX 200 prints mild losses tracking China but New Zealand’s optimism concerning the virus help NZX 50 to rise 0.15% intraday at the latest.

Moving on, Hong Kong’s Hang Sang and South Korea’s KOSPI drop over 1.0% but Indonesia’s IDX Composite rises 0.40% by the press time. India’s BSE Sensex also prints mild gains at the latest amid recently easing virus cases and hopes of further stimulus at home.

On a broader front, S&P 500 Futures drop 0.40% whereas the US 10-year Treasury yields drop 1.5 basis points (bps) to 1.65% while portraying a pullback from a six-week high.

Looking forward, the anticipated easing in the ADP may help keep the investors hawkish but readiness for a faster rate hike in 2022 by the Fed policymakers, per FOMC Minutes, will be enough to recall the pair bears.

Read: US T-bond yields retreat from six-week high, S&P 500 Futures ease amid cautious sentiment