Asian petchem shares, oil prices mixed amid doubts on new virus vaccine

Nurluqman Suratman

20-May-2020

SINGAPORE (ICIS)–Asian petrochemical shares and oil prices were mixed on Wednesday as investors mulled over fresh doubts cast on a promising coronavirus vaccine that is currently on trial.

At 02:10 GMT, Mitsubishi Chemical Holdings was down by 0.57% in Tokyo, PetroChina Co was 1.08% lower in Shanghai and Lotte Chemical Corp was up by 0.52% in Seoul.

Japan’s Nikkei 225 Index rose by 0.75%, Hong Kong’s Hang Seng Index was 0.03% lower and Singapore’s Straits Times Index was down by 0.61%.

Company/Stock Exchange % Change
Nikkei 225 (Tokyo) 0.75%
Asahi Kasei Corporation -0.08%
JXTG Holdings, Inc. -0.28%
Mitsubishi Chemical Holdings Corporation -0.57%
Mitsui Chemicals, Inc. 0.30%
Hang Seng Index (Hong Kong) -0.03%
Sinopec Shanghai Petrochemical Company Limited 0.00%
PetroChina Company Limited -1.08%
KOSPI Composite Index (Seoul) 0.40%
OCI Company Ltd 2.44%
SK Innovation Co., Ltd. 0.48%
LG Chem, Ltd. 0.14%
Lotte Chemical Corporation 0.52%
Hanwha Corporation 0.26%
TSEC weighted index (Taipei) 0.26%
Formosa Petrochemical Corporation -0.65%
Nan Ya Plastics Corporation -0.16%
Formosa Chemicals & Fibre Corporation 0.27%
STI Index (Singapore) -0.61%
Wilmar International Limited 0.00%
Olam International Limited 0.67%
FTSE Bursa Malaysia KLCI (Kuala Lumpur) -0.15%
SSE Composite Index (Shanghai) -0.28%
Jakarta Composite Index 0.12%
PT. Chandra Asri Petrochemical Tbk 4.96%

Overnight, US stocks fell for the first time in four sessions, after doubts were cast on a promising coronavirus vaccine that is currently on trial despite news of more countries easing lockdown measures.

Health-focused media firm STAT on Tuesday reported that vaccine experts are maintaining that the drug company running the trial did not produce the data critical to assess the vaccine’s success.

US data released on Tuesday showing housing starts and US building permits worsening in April also weighed on investor sentiment.

In Asia, Japan could lift its state of emergency in more regions this week as new coronavirus infections drop, according to local media reports.

Japanese Prime Minister Abe had already freed 39 of Japan’s 47 prefectures last week from a blanket state of emergency.

China maintained its benchmark lending rate steady as expected on Wednesday. The one-year loan prime rate (LPR) was kept at 3.85% from last month’s fixing, while the five-year LPR was also steady at 4.65%.

South Korea announced in a ministerial meeting on Wednesday that more efforts will be made to aid economic recovery.

Specifically, a third budget worth South Korean won (W) 3.5 tr ($2.8bn) will be announced in early June, which is slated to create an additional 550,000 jobs in public firms.

Indonesia on Tuesday extended its coronavirus measures until 4 June, which had already placed restrictions on public transportation use and limited social gatherings in a bid to contain the coronavirus in capital city Jakarta.

The Singapore government on Tuesday announced that it will end its “circuit breaker” period on 1 June as scheduled, with measures to be progressively lifted in three phases effective 2 June.

The number of coronavirus cases have risen to 4.74m cases globally, with 316,289 deaths, according to the latest data from the World Health Organization (WHO).

In Asia, India’s number of cases surpassed 100,000 on 19 May, even as the country gradually eased restrictions while extending its lockdown to 31 May 2020.

China, which lifted the lockdown on Wuhan on 7 April 2020, had reported six new cases as of 19 May.

China’s Shulan city, home to 700,000 people, has also been placed under a Wuhan-style lockdown amid fears of a renewed outbreak.

$/bbl (As of 03:07 GMT) Last price % change Net change Close High Low
July Brent 34.74 0.26% 0.09 34.65 34.81 34.38
June US TWI 31.93 -0.09% -0.03 31.96 32.04 31.56

Crude oil prices were mixed as signs of improving demand and production cuts by major producers were weighed by concerns over a prolonged global recession.

US crude inventories fell by 4.8 million barrels to 521.3 million barrels in the week to 15 May, data from industry group the American Petroleum Institute (API) showed on Tuesday.

Visit the ICIS Coronavirus topic page for analysis of the impact on chemical markets and links to latest news.

Focus article by Nurluqman Suratman

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