Asia report: China stocks sink on mixed day for region
15th Oct 2024 09:20
(Sharecast News) - Asian markets had a mixed performance on Tuesday, with China underperforming the broader region following disappointing trade data.
Japan, South Korea, and Australia meanwhile saw gains, buoyed by a positive lead from Wall Street.
"Asian equities broadly advanced, with Japan's Nikkei leading regional gains after prime minister Shigeru Ishiba reportedly stated his government aims to draft a supplementary budget for the current fiscal year exceeding the previous year's JPY 13.1trn to fund an economic support package," said Patrick Munnelly at TickMill.
"The yen declined from a two and a half-month high amid bets the Bank of Japan will forgo raising interest rates again this year.
"Chinese and Hong Kong markets declined after weekend announcements from authorities about economic support failed to inspire investor confidence."
Munnelly noted that the dollar surged to a two-month peak, as gold edged lower, aided by expectations of a smaller US rate cut next month.
"European equities are expected to start the trading session on a positive note on Tuesday, driven by investor confidence in corporate financial results.
"The attention now turns to the financial results of Bank of America, Citigroup, Goldman Sachs, Johnson & Johnson, UnitedHealth, and Walgreens, following positive earnings reports from JP Morgan and Wells Fargo."
Most markets rise, but China sinks further
China's major stock indexes fell sharply as September trade figures came in below expectations in a release after markets closed on Monday.
The Shanghai Composite dropped 2.53% to 3,201.29, while the Shenzhen Component also shed 2.53% to 10,066.52.
Export growth of 2.4% and import growth of 0.3% both missed forecasts, raising concerns about the health of China's economy.
Property and auto-related stocks saw significant declines, with Tianjin Realty Development down 10.04% and Changzhou Xingyu Automotive Lighting Systems falling 8.31%.
In Hong Kong, the Hang Seng Index slumped 3.67% to 20,318.79, led by steep losses in China Resources Beer, down 12.87%, and Xinyi Solar, down 8.83%.
Japan's Nikkei 225 rose 0.77% to 39,910.55, with technology stocks driving the gains.
Lasertec surged 6.63%, while Isetan Mitsukoshi climbed 6.55%.
The broader Topix index gained 0.64% to 2,723.57.
South Korea's Kospi 100 also posted gains, rising 0.44% to 2,647.36, with SK Biopharmaceuticals up 5.62% and Samsung Biologics advancing 4.44%.
In Australia, the S&P/ASX 200 added 0.79% to close at 8,318.40, led by mining stocks, with Resolute Mining up 5.26%.
New Zealand's S&P/NZX 50 gained 0.58% to 12,840.77, with Fletcher Building up 3.24%.
In currency markets, the dollar was last down 0.48% on the yen to trade at JPY 149.04, while it rose 0.24% against the Aussie to AUD 1.4902, and advanced 0.13% on the Kiwi, changing hands at NZD 1.6427.
Oil prices fell sharply, with Brent crude futures last down 4.49% on ICE to $73.98 per barrel, and the NYMEX quote for West Texas Intermediate falling 4.69% to $70.37.
China considering raising ANY 6trn through bonds - reports
In economic news, China was reportedly considering raising an additional CNY 6trn through treasury bonds over the next three years to stimulate its economy, according to a report from Caixin.
Sources familiar with the plan apparently indicated that the funds would partly be used to address local governments' off-the-book debt, which had been a growing concern.
The move would mark a significant step in China's efforts to boost economic activity amid ongoing challenges.
In Indonesia, fresh data on Tuesday showed export growth slowing to 6.44% year-on-year in September, falling short of the 8% expected by analysts surveyed by Reuters.
The total value of exports reached $22.08bn, representing a 5.8% decline from August levels.
Meanwhile, the Bank of Indonesia was in the midst of a two-day monetary policy review, with key decisions expected to be announced on Wednesday.
Reporting by Josh White for Sharecast.com.