Asia report: Markets mixed ahead of key US inflation data

29th Feb 2024 07:21

(Sharecast News) - Asia-Pacific markets experienced a mixed trading session on Thursday, with investors looking ahead to US inflation data to gauge the Federal Reserve's stance on interest rates.

The US personal consumption expenditures (PCE) price index, considered the Fed's preferred inflation metric, is scheduled for release later in the global day.

"Equity markets in China are higher, while elsewhere in the Asian region they are more mixed," said TickMill market analyst Patrick Munnelly.

"The Japanese yen outperformed after a Bank of Japan board member hinted at a possible end to negative interest rates.

"Overnight, the latest PMI indices for China will be of interest, reflecting ongoing concerns about the world's second-largest economy."

Munnelly said Chinese markets had experienced a significant upswing in February, outperforming global stocks by a considerable margin.

"This surge is attributed to a series of measures enacted by the government aimed at bolstering market confidence.

"Markets are optimistic and expect further support measures to be announced during the upcoming National People's Congress meeting."

Markets in a mixed state across Asia-Pacific region

In Japan, the Nikkei 225 index edged down slightly by 0.11%, closing at 39,166.19, while the broader Topix index saw a marginal uptick of 0.03% to reach 2,675.73.

Notable decliners on Tokyo's benchmark included Tokyo Electric Power, down 4.66%, Tokyo Gas, off 4.32%, and DeNA Co, which lost 4.06%.

Meanwhile, Chinese stocks demonstrated strength, with the Shanghai Composite jumping 1.94% to settle at 3,015.17, and the Shenzhen Component rallying by 3.13% to reach 9,330.44.

Leading the gainers in Shanghai were Fujian Furi Electronics and Advanced Micro Fabrication, rising 10.06% and 10.03%, respectively.

In Hong Kong, the Hang Seng Index slipped by 0.15%, closing at 16,511.44, led lower by Budweiser Brewing Company, down 6.63%, Baidu, off 6.61%, and China Shenhua Energy, which lost 3.2%.

South Korea's Kospi declined 0.37%, settling at 2,642.36, with major losers including Hanjinkal and Samsung Life, down a respective 10.86% and 5.83%.

On the Australian front, the S&P/ASX 200 index recorded a modest gain of 0.5%, closing at 7,698.70.

Notable performers in Sydney included Macquarie Technology Group, up 9.12%, and Ramsay Health Care, which added 7.27%.

Across the Tasman Sea, New Zealand's S&P/NZX 50 index dipped slightly by 0.19%, reaching 11,741.47, led lower by Eroad and Mercury NZ, which were off 4.76% and 3.75%, respectively.

In currency markets, the dollar was last 0.42% weaker on the yen, trading at JPY 150.06, while it was down 0.01% against the Aussie at AUD 1.5392.

Conversely, the greenback saw a modest increase of 0.21% on the Kiwi to change hands at NZD 1.6432.

On the oil front, Brent crude futures were last down 0.22% on ICE, at $83.50 per barrel, while the NYMEX quote for West Texas Intermediate edged down 0.15% to $78.42.

Manufacturing output in Japan falls more than expected

In economic news, fresh official data indicated a 7.5% decline in Japan's manufacturing output for January compared to the prior month, coming in lower than the 7.3% drop forecast in a Reuters poll.

At the same time, Japan's retail sales saw a 2.3% year-on-year increase in January, aligning with Reuters' estimates.

In Australia, retail sales rebounded in January, according to the Australian Bureau of Statistics.

After a 2.1% decrease in December, Australian retail sales surged by 1.1% last month.

Ben Dorber, head of retail statistics at the ABS, attributed the January rebound to a pullback in spending following November's Black Friday sales frenzy.

Dorber noted that retail turnover had now returned to a level akin to September.

Reporting by Josh White for Sharecast.com.