Current Futures: Dow -48.00, S&P -6.10, NASDAQ -11.25
Asian markets trade barely below the breakeven line, erasing the gains posted during the opening bell. At the same time, U.S. futures also declined.
The Asian financial markets turned bearish after Toyota said its losses would widen to $5.50 billion this year, on weaker domestic and external demand. Toyota’s outlook is twice as bad as the initial estimates, but is inline with the overall industry reports. However, the market withstood the declines seen in the car industry from being helped by the raw material producers and the financial sector. Commodity stocks gained a lot of ground over the last few days of trading, as crude oil reached the highest value since November 2008.
For now, the Asian markets are sitting at the highest value in the last seven months, helped by the strong gains seen in March and April. In these two months, the major indexes from the region gained almost 40%, as positive economic news feed the investors’ hope that the economy is reviving. Moreover, TheLFB-Forex.com Trade Team notes that the Chinese economy has experienced only limited affects from the credit crisis until now, which further strengthened the equity rally in the area. “China is one of the biggest economies in the region, and has the strength to influence the demand side from its neighbor countries, like Japan and South Korea or Taiwan,” they added. “The additional demand coming from China helped some companies water the credit crisis with more ease, since China is responsible for large bulk of orders in the region.”
Overnight, the Japanese Nikkei declined 9.63 points (0.10%) to 9,423.20. The Australian S&P/Asx slipped 15.90 points (0.40%) to 3,925.80.
Crude oil for May delivery was recently trading at $58.40 per barrel, down by $0.20.
Gold for May delivery was recently trading higher by $0.80 to $915.65.