Asia: Chinese stocks rise as data puts further pressure on monetary stimulus
Most Asian indices were in the red on Wednesday, while China rose thanks to mixed manufacturing data, which added pressure to further stimulus.
BHP Billiton Ltd.
$45.42
08:31 22/04/24
Nikkei 225
37,552.16
09:45 22/04/24
Rio Tinto Limited
$129.78
08:31 22/04/24
Santos Limited
$7.74
08:31 22/04/24
Toyota Motor Corporation(Sapporo)
n/a
n/a
Shanghai's composite index was up 1.66%, as data, though better than expected, raised hopes that Beijing will step in to bolster the economy. Hong Kong's Hang Seng also rose 0.73%
HSBC’s final estimate of the Chinese purchasing managers’ index (PMI) for manufacturing in March was revised to 49.6 from a previous estimate of 49.2, ahead of analysts’ forecasts of 49.3 though it still remained in contraction (below 50).
A separate measure of China manufacturing also showed an improvement in March. The China Federation of Logistics and Purchasing said the PMI rose to 50.1 last month from 49.9 in February.
While both surveys beat analysts' expectations, they showed that industrial employers shed more jobs last month.
Meanwhile, the official PMI for Chinese non-manufacturing fell to 53.7 from 53.9.
Capital Economics' China economist Julian Evans-Pritchard said: "Today's PMI readings suggests that manufacturing conditions, among large firms at least, have held up better than expected." He added that the data "suggests that the recent rate cuts and pick-up in bank lending growth may be helping to support large firms".
However, Pritchard warned "growth is still likely to have slowed sharply last quarter and we expect more policy support measures, including further rate cuts and required reserve ratio reductions, as the government moves to avoid missing its annual growth target".
The Nikkei 225 declined 0.9% after weak data from the Bank of Japan's Tankan survey put further pressure on the Bank of Japan to implement more stimulus measures.
The large manufacturing index came at 12 during the first quarter against expectations of 14 points, while the large manufacturing outlook came at 10 against forecasts of 16.
According to the Tankan survey, sentiment among Japanese manufacturers remained unchanged but came lower than expectations.
The survey drove stocks lower, with the dollar falling 0.2% to ¥119.83.
Australia's ASX also fell 0.52% amid the wider commodities market slump.
On Wednesday, Brent was trading down 0.58% or 32 cents at $54.79 per barrel, while the WTI was down 0.63% or 30 cents at $47.30 per barrel in Asian trading.
In company news, Australian mining group BHP Billiton fell 2.22% and its rival Rio Tinto was down 1.43%.
Oil and gas company Santos was hurt by the drop in Brent prices, coming down by 2.94%.
Elsewhere in Japan, Toyota lost 1.75% after reporting a drop in sales in China by 2.9% in March.