HONG KONG, June 1, 2022 (BSS/AFP) - Asian markets fluctuated Wednesday

following losses on Wall Street and data reminding traders that inflation
shows no sign of easing.

Oil edged up after seeing a sharp drop earlier on reports that OPEC was
considering suspending Russia from an output deal, which observers said could
allow producers to pump more.

Regional equities have enjoyed a largely healthy run of late on hopes that
inflation could be nearing a peak and a sell-off across markets may have run
its course, while the easing of some lockdown measures in China added to the
optimism.

However, investors were brought down to earth with a bump Tuesday with
figures showing eurozone inflation hit a record high in May owing to
rocketing energy costs.

The news puts extra pressure on the European Central Bank to act quicker to
rein in prices by hiking interest rates along with the Federal Reserve.

There is a fear that acting too late could mean policymakers will have to
announce harder, more painful increases later on.

"There are heightened concerns around inflation and where central banks are
likely to go trying to combat inflation," Kristina Hooper, of Invesco
Advisers, told Bloomberg Radio.
"This has gone from just an inflation scare to a growth scare. Uncertainty
has grown."

Equity markets were mixed in Asian trade.

Hong Kong and Shanghai slipped along with Taipei and Manila, though Tokyo,
Singapore and Wellington rose. Sydney was flat.

But ACY Securities chief economies Clifford Bennett remained wary.

"After this brief euphoria stock prices are again vulnerable to a mass 'get-
out' frenzy as the reality of the already in full swing global slow-down
accompanied by ever-higher interest rates begin to take their toll," he said
in a commentary.

Oil prices struggled to rebound after falling more than four percent late
Tuesday in reaction to a Wall Street Journal report that OPEC was considering
removing Russia from an agreement that has locked producers into limited
output increases.

Moscow's removal would mean an early end to the pact and allow major crude
nations such as Saudi Arabia to open the taps, analysts said.

"If there's any confirmation from OPEC+ members that the absence of Russia is
being discussed, then prices can drop to as low as $100," said Will Sungchil
Yun, at VI Investment Corp.

"There's a need for OPEC+ to come up with a plan, as oil prices are likely to
keep surging and boost inflationary pressure."

Matthew Simpson of StoneX Financial said that it was debatable whether such a
move would offset a partial European Union embargo on Russia and the expected
pick-up in Chinese demand as lockdowns are eased.

But he added that "it can also be argued that much of the drivers behind
oil's recent rally has been priced in. Regardless, we can see that some wind
has been taken out of the oil rally sails".

- Key figures at around 0230 GMT -

Tokyo - Nikkei 225: UP 0.7 percent at 27,472.49 (break)

Hong Kong - Hang Seng Index: DOWN 0.4 percent at 21,326.02

Shanghai - Composite: DOWN 0.2 percent at 3,178.84

Euro/dollar: DOWN at $1.0719 from $1.0739 on Tuesday

Pound/dollar: DOWN at $1.2600 from $1.2603

Euro/pound: DOWN at 85.08 pence from 85.18 pence

Dollar/yen: UP at 129.05 yen from 128.72 yen

Brent North Sea crude: UP 0.5 percent at $116.18 per barrel

West Texas Intermediate: UP 0.6 percent at $115.31 per barrel

New York - Dow: DOWN 0.7 percent at 32,990.12 (close)

London - FTSE 100: UP 0.1 percent at 7,607.66 (close)

-- Bloomberg News contributed to this story –