Asia report: Markets mixed on China PMI, BoJ meeting
Markets in Asia finished mixed on Tuesday, with fresh economic data and decisions from China and Japan keeping investors busy through the day.
AUD/USD
$0.6401
07:12 19/04/24
GBP/NZD
NZD2.1117
07:12 19/04/24
Hang Seng
16,184.02
10:20 18/04/24
Nikkei 225
37,084.81
09:44 18/04/24
USD/JPY
¥154.3220
07:12 19/04/24
In Japan, the Nikkei 225 was practically unchanged, losing just 0.06 points to close at 22,011.61, as the yen weakened 0.11% against the dollar to last trade at JPY 113.31.
The Bank of Japan ended its two-day policy meeting on Tuesday, holding steady on monetary policy and maintaining its short-term interest rate at a negative 0.1%.
On the economic front, industrial production in Japan fell 1.1% month-on-month in September, ahead of expectations for a fall of 1.5% as predicted in a Reuters poll.
Technology plays were mixed in Tokyo as financial stocks closed in the red - Mitsubishi UFJ fell 2.57% and Nomura Holdings was off 2.71%, while Sony was ahead 2.39%.
Video games giant Nintendo almost doubled its full-year profit forecast to JPY 120bn, from JPY 65bn, after it beat quarterly profit forecasts.
It was expecting profit of JPY 19bn in the quarter, but reported JPY 23.7bn, leading to a 2.17% rise in its share price.
Softbank was on the back foot, losing 4.63% after reports talks between US cellular carriers T-Mobile and Softbank’s Sprint had hit a rough patch.
The Nikkei claimed Softbank was preparing to abandon the merger talks on Monday.
On the mainland, the Shanghai Composite was ahead 0.12% at 3,394.50, and the smaller, technology-heavy Shenzhen Composite was 0.69% firmer at 2,002.28.
China’s official manufacturing purchasing managers index came in at 51.6 for October, missing the 52.0 estimated by economists in a Reuters poll.
Its official services PMI was 54.3, falling short of the 55.4 reported for September.
“[These falls are] unlikely to change the broad picture of steady growth in 2017,” noted ANZ senior China economist Berry Rui Wang.
South Korea’s Kospi was up 0.86% at 2,523.43, while the Hang Seng Index in Hong Kong lost 0.32% to 28,245.54.
Carmakers were on the front foot in Seoul, while blue-chip technology stocks fell behind - Hyundai Motor was up 3.21% and LG Electronics fell 4.01%.
Retail giant Lotte Shopping rocketed ahead 7.14% amid reports South Korea and China would work to mend recently-cool relations, which took a turn for the worse as Korea deployed an anti-missile system earlier this year.
That led to a state-backed boycott of Korean companies in China, where Lotte has a large retail presence.
Technology giant Samsung Electronics reported a near-tripling of its third quarter profit year-on-year to KRW 14.5trn, which was apparently boosted by a surge in income for its memory chip unit.
Shares in Samsung finished the session ahead 1.92%.
At the start of the Asian session, US tax cuts were again at the top of the agenda, with Bloomberg reporting that planned cuts to the corporate rate would be implemented in stages of 3% each year from 2018.
The current federal corporate tax rate is 35%.
Investors were also looking for clues as to how the Federal Open Market Committee might move following its two-day meeting, which began on Tuesday, as well as President Trump’s choice for the next Fed chair, which he is expected to announce on Thursday.
Oil prices were still marginally ahead during Asian trading, though prices slipped as Europe took the trading baton, with Brent crude last down 0.21% at $60.77 per barrel and West Texas Intermediate off 0.17% at $54.08.
In Australia, the S&P/ASX 200 was off 0.17% at 5,909.02, with losses in the hefty financials subindex offsetting solid gains for consumer staples.
Across the Tasman Sea, New Zealand’s S&P/NZX 50 eked out gains of 0.03% to 8,146.34, led higher by aged care residential developer Ryman Healthcare, which was ahead 1.8%.
The down under dollars were both weaker, with the Aussie last off 0.41% against the greenback at AUD 1.3060, and the Kiwi continuing its extended weakening since the country’s new leftist government was revealed, retreating 0.46% to NZD 1.4609.