Market Brief: Nikkei 225 and Asian Stocks Slide As Oil Futures Plunge

DAX
DAX

Asian markets finished lower as the markets turmoil returned with negative prices on oil futures yesterday. WTI futures May contract, which expires today fell to record lows of -37.63 a barrel during the U.S. trading session; the WTI June deliver contract trading around $20.00. The drop in oil May’s future contract turned negative for the first time in history. Shortage in storage facilities and the futures delivery today which at expiration offers physical delivery drove the price of crude oil to negative levels. The Brent oil was down almost 9% around $25.

Nikkei 225 finished 1.79% lower at 19,280. The Singapore Straits Times is 1.20% lower at 2,566. The Shanghai Composite is 0.83% lower at 2,828, while the Hang Seng Index is 1.78% lower at 23,888. The ASX 200 index in Australia ended 0.52% lower at 5,324 after RBA reiterated its commitment to support jobs, incomes and businesses.

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Nikkei 225 Retreat From Monthly Highs

Nikkei 225 slide from monthly highs a the plunge in crude oil price shows that the markets are from normal reactions. The lockdown continues to weigh on markets despite some positive signs from some European countries that eased the restrictions.   

On the technical side, first support seen at 19,193 today’s low, if the index moves below, the next critical support will be met at 19,034 the low from April 13. In case of more selling pressure below that level, the next support zone stands at 18,542 low from April 7.

On the other hand, immediate resistance for the index stands at 19,529 the daily high. The next resistance for the Nikkei 225 stands at 19,790 the high from yesterday’s trading session. If the Nikkei 225 index moves higher, the next supply zone is at 19,935 the monthly high from April 17.

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