Asia: Stocks mixed as gold hits 5-year low, China up on improved housing data
Asian indices started the week on a mixed note due to a weaker commodities market, with gold slumping to a five-year low on Monday.
Commonwealth Bank of Australia
$112.99
07:35 26/04/24
National Australia Bank Limited
$33.51
07:35 26/04/24
Nikkei 225
37,934.76
09:44 26/04/24
As of 0724 BST gold futures for August delivery on COMEX were at $1,108 per ounce, down by more than 2% from Friday's close of $1,131.40.
Craig Erlam from Oanda said gold saw an "enormous amount of interest" as a sudden sell-off in the precious metal triggered a number of stop losses, knocking almost $60 off the price in less than a minute.
"It has since stabilised to trade back above $1,100 but I expect interest in it to remain today," he added.
In China, the Shanghai Composite index was up 0.88% driven by positive data and additional support from the country's securities regulator.
House prices continued to see a slowdown but at slower pace in June to -4.9% from -5.7% a month earlier, according to the National Bureau of Statistics.
Rabobank analysts said: "There may again be something Kafkaesque about that recovery given it does not seem to have registered the recent volatility in equities, which anecdotal reports suggest has hit real estate hard."
HSBC expects a further cut in Chinese banks’ reserve requirement ratio and further monetary easing in the third quarter to encourage economic activity.
Meanwhile, the Chinese central bank published new guidelines on its website over the weekend in a bid to regulate Internet finance.
In other news, figures released on Friday by the country showed that China has been the world’s second-biggest buyer of gold over the last six years.
In its first update since 2009, the People’s Bank of China said it owns about 1,658 metric tonnes of gold, which indicates it purchases approximately 100 tonnes of the metal each year.
“China hasn’t been very open about its strategy, so what matters now is whether the market believes they intend to continue buying,” Joni Teves, an analyst at UBS in London was quoted as saying by Bloomberg.
Elsewhere, in Hong Kong, the Hang Seng index fell 0.04% due to profit-taking.
Hong Kong-listed Haitong Secutiries fell 2.94% despite reporting that its net profit and operating income more than tripled during the first half of the year.
The Japanese Nikkei 225 was closed for Marine Day holiday, which Craig Erlam said to be "significantly hitting trading volumes".
Elsewhere in Australia, the ASX index rose 0.3% despite high volatility in the commodities world.
Australian Prudential Regulatory Authority decided to raise bank capital requirements for home loans from 16% to at least 25% from July 2016.
Despite the news, banking stocks were higher with the National Australia Bank gaining 0.29% and the Commonwealth Bank Of Australia rising 0.43%.