Asia report: Stocks mixed as investors sift through China trade data

10th Sep 2024 09:22

(Sharecast News) - Asia-Pacific markets experienced a mixed performance on Tuesday as investors reacted to fresh data from China and the positive momentum from Wall Street's rebound.

The region's trading reflected a cautious optimism driven by China's export growth, though tempered by lower-than-expected import figures.

"Asian stocks experienced a modest advance, however they were unable to maintain an optimistic rally on Wall Street due to concerns regarding the Chinese economy's decline," said Patrick Munnelly at TickMill.

"Overnight data indicated that China's exports experienced their most significant growth since March 2023 in August.

"This suggests that manufacturers are expediting the production of orders in anticipation of tariffs from several trade partners."

Munnelly noted that imports conversely failed to meet expectations due to lacklustre domestic demand.

"This was in response to the inflation figures released on Monday, which indicated that domestic demand remained fragile as producer price deflation deteriorated.

"This has prompted requests for additional stimulus from Beijing to support its economy."

Markets in a mixed state with Japan in the red

In Japan, the Nikkei 225 edged down 0.16% to close at 36,159.16, with the broader Topix slipping 0.12%.

Key losses on Tokyo's benchmark came from pharmaceutical company Daiichi Sankyo, which dropped 8.64%, followed by Taiyo Yuden, down 4.1%, and Terumo Corporation, which fell 3.19%.

China's markets performed better, with the Shanghai Composite gaining 0.28% to 2,744.19 and the Shenzhen Component up 0.13% at 8,073.83.

Leading the charge in Shanghai were Beijing Dynamic Power Co, Shandong Homey Aquatic Development, and Jiangxi Changyun, each surging over 10%.

Hong Kong's Hang Seng Index also rose, gaining 0.22% to 17,234.09.

Tech giant Alibaba saw its shares climb 4.21%, bolstered by its inclusion in the Stock Connect cross-border investment scheme, which allows broader access for investors between mainland China and Hong Kong.

Other strong performers included Li Auto, up 6.33%, and Chow Tai Fook Jewellery Group, up 4.03%.

South Korea's Kospi 100 slipped 0.53% to 2,551.79, with major tech names suffering losses.

LG Innotek dropped 5.89%, LG Energy Solution fell 5.01%, and L&F declined by 4.93%, contributing to the index's overall weakness.

Australia's S&P/ASX 200 rose 0.3% to 8,011.90, buoyed by gains in energy and resource stocks.

Paladin Energy led the market with a 5.85% rise, followed by Polynovo, up 5.11%, and West African Resources, which added 4.2%.

New Zealand's S&P/NZX 50 saw a modest increase of 0.09% to close at 12,632.82, supported by property and communications stocks.

Investore Property gained 3.33%, Vital Healthcare Property Trust added 3.13%, and Chorus rose 2.51%.

In foreign exchange markets, the dollar was weaker across the region's major trading currencies, last trading down 0.06% on the yen at JPY 143.09.

It was off 0.08% against the Aussie at AUD 1.5001, while it retreated 0.23% from the Kiwi to change hands at NZD 1.6236.

Oil prices also declined, with Brent crude futures last down 1.25% on ICE at $70.94 per barrel, and the NYMEX quote for West Texas Intermediate falling 1.36% to $67.76.

China trade data for August comes in mixed

In economic news, China's trade data for August revealed stronger-than-anticipated export growth, while import growth lagged behind expectations.

According to customs data, the country's exports rose by 8.7% year-on-year, surpassing a Reuters poll forecast of 6.5%.

That marked an improvement from July's 7% increase.

However, imports grew just 0.5% over the same period, falling short of the expected 2% increase and a significant drop from July's 7.2% rise.

Reporting by Josh White for Sharecast.com.