Asian stocks open mixed Tuesday after U.S. stocks closed lower as tensions in Greece reignited concerns of a possible Greek exit from the Eurozone, weighing on investor sentiment. Economists are looking ahead to key inflation data out of China later in the trading session that will gauge consumers’ purchasing power in the world’s second-largest economy.
The Nikkei 225 Index, the leading index of Japanese stocks, dropped 89.17 points, or 0.48 percent, to 17,627.02.
Meanwhile, Hong Kong stocks dropped Monday following weaker-than-expected Chinese trade data. The Hang Seng Index, an index of 40 of the largest companies that trade on the Hong Kong Exchange, closed down 158.39 points, or 0.64 percent, to 24,521. The Shanghai Composite Index, a composite of all stocks (A shares and B shares) that are traded at the Shanghai Stock Exchange, added 19.22 points, or 0.62 percent, to close at 3,095.12.
Asian Shares Edge Lower
Ahead on the economic calendar, economists will be eyeing data out of China Tuesday after the world’s second-largest economy reported Sunday exports dropped 3.3 percent last month from a year earlier while imports tumbled 19.9 percent, widely missing analysts’ expectations.
However, economists say the sharp fall in headline trade growth in January is not cause for alarm as it largely reflects the usual volatility ahead of the Chinese New Year along with the fall in global commodity prices, which has lowered the dollar value of imports.
“We wouldn’t read too much into the sharp falls as trade growth, particularly imports, is highly volatile at the start of the year due to shifts in the timing of Chinese New Year, which disrupts manufacturing activity as migrant workers return home but also leads to a preholiday rush to complete outstanding export orders,” Julian Evans-Pritchard, China economist at Capital Economics, said in a research note Monday.
China is scheduled to release key inflation data Tuesday, including its consumer price index, which measures the prices of consumer goods and services, along with its producer price index, which gauges the average change in selling prices that are measured at the wholesale level.
Greek Exit Fears Escalate
U.S. stocks closed lower Monday, with the Dow Jones Industrial Average briefly dropping more than 100 points in afternoon trading as tensions in Greece reignited concerns of a possible Greek exit from the eurozone.
The Dow Jones Industrial Average, which measures the share prices of 30 large industrial companies, fell 95.08 points, or 0.53 percent, to close at 17,729.21; the Standard & Poor’s 500 stock index lost 8.73 points, or 0.42 percent, to end at 2,046.74. The Nasdaq Composite fell 18.39 points, or 0.39 percent, to finish at 4,726.01.
“The on-again, off-again relationship between Greece and the European Central Bank creditors is certainly a factor with today’s market decline. Throw in the mounting uncertainty of Russia and Ukraine and a little bit of an absence of earnings data, and investors are left to try to bring balance to all of the different data points. The unresolved nature of what’s going on throughout the eurozone is certainly giving investors room to pause right now,” said Eric Wiegand, senior portfolio manager at U.S. Bank Wealth Management.
Oil Prices Close Higher
Oil prices continued to trade higher Monday, gaining for a third straight session after the Organization of Petroleum Exporting Countries said the demand forecast for its oil would be higher than expected in 2015.
“We view oil’s current level with a degree of skepticism. We’ve seen a response in the oil fields themselves and we’ve seen the rig count reduced rather meaningfully, but we haven’t seen a production response as well. We are certainly anticipating greater volatility as we move through the year as far as crude prices are concerned,” Wiegand said.
Brent crude rose 0.9 percent Monday to $ 58.34 a barrel for March 15 delivery on the London ICE Futures Exchange. Meanwhile, West Texas Intermediate crude, the benchmark for U.S. oil prices, added 2.3 percent Monday to $ 52.86 a barrel for March 15 delivery on the New York Mercantile Exchange.
Coca-Cola to Post Q4 Results
Ahead on the corporate earnings calendar, Dow component The Coca-Cola Company is slated to post quarterly results ahead of the opening bell Tuesday after the company’s profit tumbled 14 percent in the third quarter as the world’s largest beverage-maker struggles to find growth amid changing consumer tastes. The Coca-Cola Company is expected to report fiscal fourth quarter net income of $ 1.87 billion, or earnings per share of 41 cents, on revenue of $ 10.76 billion, according to analysts polled by Thomson Reuters. That compares to a profit of $ 2.06 billion, or earnings per share of 38 cents, on revenue of $ 11.04 billion during the same period a year ago.