Hong Kong’s Hang Seng index drops more than 2% in mixed Asia trading; oil prices fall 3%

Investors will continue to monitor developments around the Russia-Ukraine war and Covid wave in China, both of which threaten to further disrupt global supply chains.

SINGAPORE — Shares in Asia-Pacific were mixed in Monday morning trade as investors monitor a Covid wave in China. Meanwhile, oil prices continued to be volatile amid the Russia-Ukraine war.

Hong Kong’s Hang Seng index dropped 2.77% in morning trade as shares of Chinese tech heavyweight Tencent fell 3.43%. Mainland Chinese stocks were also lower, with the Shanghai composite down 1.5% while the Shenzhen component shed 1.46%.

In Japan, the Nikkei 225 climbed 1.03% while the Topix index advanced 0.97%. The S&P/ASX 200 in Australia gained 1.07%.

South Korea’s Kospi lagged, dipping 0.54%.

MSCI’s broadest index of Asia-Pacific shares outside Japan traded 0.99% lower.

Investors continued watching developments on the Russia-Ukraine war, which is disrupting shipping and air freight. Elsewhere, markets also monitored a recent wave of Covid infections in China — including the major city of Shenzhen.

Oil prices fall 3%

Oil prices fell in the morning of Asia trading hours, with international benchmark Brent crude futures down 3.03% to $109.26 per barrel. U.S. crude futures shed 3.16% to $105.87 per barrel.

Oil prices during the Russia-Ukraine conflict have spiked to record levels but fell back in the past week on supply hopes, before rising again to close out the week. Over in Asia, China, India, Japan and South Korea are all major importers of oil, according to 2020 data from the International Energy Agency.

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The U.S. Federal Reserve is widely expected to announce a rate hike later this week, the first such move since 2018.

In Asia, the Bank of Japan is also set to announce its monetary policy decision later in the week.

Currencies

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 99.049 after its recent bounce from below 98.

The Japanese yen traded at 117.66 per dollar after last week’s weakening from below 116 against the greenback. The Australian dollar was at $0.7275 after slipping from above $0.732 late last week.