Asian shares mixed as investors eye inflation, earnings

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Asian shares were mixed to begin Tuesday, as investors weighed oil prices, inflation worries and corporate earnings.

Benchmarks in Tokyo and Shanghai were higher in morning trading. Shares fell in Sydney, South Korea and Hong Kong, where investor sentiments were subdued after an early rally evaporated on Wall Street.

Analysts say the Tokyo market is seeing some buying after a three-day weekend. Monday was a national holiday in Japan. Investors are playing catchup and so the rally may be short-lived. Among the issues picking up so far are Fast Retailing, the group company for the Uniqlo clothing retail chain, as well as Sony Corp.

The Dow slid 215.65 points, or 0.7%, to 31,072.61, and the Nasdaq gave up 92.37 points, or 0.8%, to 11,360.05. The Russell 2000 index of smaller companies also fell. It dropped 5.96 points, or 0.3%, at 1,738.42. A key report released last week indicated expectations are easing for inflation among households. That could prevent a more vicious cycle from taking root and ease the pressure on the Federal Reserve.

Later this week, investors expect the European Central Bank on Thursday to raise interest rates for the first time in 11 years to combat inflation. Many investors expect an increase of 0.25 percentage points, “but more is not unthinkable," economists wrote in a BofA Global Research report. Goldman Sachs was among the latest to report, and it rallied 2.5% after its profit and revenue were better than analysts expected.

 

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