Asia-Pacific markets trade mixed amid global political chaos; bitcoin crosses $100,000
Sunrise scene of Seoul downtown city skyline, Aerial view of N Seoul Tower at Namsan Park in twilight sky in morning. The best viewpoint and trekking from inwangsan mountain in Seoul city, South Korea
Mongkol Chuewong | Moment | Getty Images
Asia-Pacific markets traded mixed Thursday after Wall Street stock benchmarks notched record highs, shrugging off global political turmoil.
Investors are continuing to monitor the political situation in South Korea and France. Less than a day after he declared martial law, lawmakers in South Korea filed a motion to impeach President Yoon Suk Yeol.
The leader of Yoon’s ruling People Power Party, Han Dong-hoon, said on Thursday that the party will try to oppose the motion, Yonhap News Agency reported. In emails sent to NBC News, Yoon’s office has maintained that his call for martial law was constitutional.
The opposition party’s deputy spokesperson Cho Seung-rae reportedly said it planned to hold the vote on Saturday 7 p.m. local time, according to local media.
South Korea released its third-quarter revised gross domestic product, which showed the economy expanded 0.1% quarter-on-quarter, and 1.5% on an annual basis, unchanged from advanced estimates.
South Korea’s market opened higher but quickly lost momentum. The Kospi fell by 0.44% while the Kosdaq was down 0.14%.
Elsewhere in Asia, Australia’s S&P/ASX 200 added 0.1% to finish at 8,471.10.
Japan’s Nikkei 225 jumped 0.31%, while the Topix traded near the flatline.
Hong Kong’s Hang Seng index futures dropped just over 1%, while mainland China’s CSI 300 index shed 0.13%.
“Investors may now attach a higher political risk premium to South Korea in the long term,” Alex Smith, head of equities investment specialist at abrdn, said in a note on Thursday, adding that the Bank of Korea and finance ministry have “helped calm the markets” by promising liquidity support.
While noting that the immediate impact on financial markets may be short-lived, the political uncertainty will add to investors’ concerns over the economy’s exposure to potential “punitive trade actions” from the incoming U.S. administration, Smith said.
Meanwhile, French lawmakers on Wednesday passed a no-confidence vote against the government of Prime Minister Michel Barnier.
Amid the political turmoil in Asia and Europe, bitcoin surged and crossed the $100,000 mark, hitting a record of $103,844, according to Coin Metrics.
In the U.S. on Wednesday, all three major indexes hit all-time highs during the session and closed at records, with tech shares leading the gains.
The Dow Jones Industrial Average advanced 308.51 points, or 0.69%, to 45,014.04, crossing the 45,000 threshold for the first time.
The S&P 500 broad market index gained 0.61% to close at 6086.49, while the tech-heavy Nasdaq Composite advanced 1.3% to close at 19,735.12.
The rally came as investors digested Fed Chair Jerome Powell’s comments Wednesday that the recent strength of the U.S. economy means U.S. central bank can afford to be “a little more cautious.”
Investors are awaiting the U.S. November unemployment report, due Friday, which would provide some insights into the Fed’s future policy moves. The next rate decision comes in two weeks, and markets are pricing in a roughly 78% chance of a quarter percentage point rate cut by the Federal Open Market Committee, according to the CME Group’s FedWatch tool.
— CNBC’s Sean Conlon, Lisa Kailai Han and Hakyung Kim contributed to this report.
