Asia report: Most markets higher as China confirms more retaliatory tariffs

Markets in Asia were mostly higher on Thursday, as Chinese indices rebounded once again amid ongoing tariff-based trade tensions between Beijing and Washington.

In Japan, the Nikkei 225 lost 0.2% to 22,598.39, as the yen weakened 0.05% against the dollar to last trade at JPY 111.04.

Major exporters came under pressure on the back of the weaker yen, with automotive firms Honda down 1.28%, Mazda slipping 1.3%, Nissan falling 0.81%, Suzuki sliding 6.04%, Toyota off 1.01% and Yamaha ending the day 4.63% below the waterline.

The vehicle industry was also rocked by a report earlier in the day from the Japan transport ministry that the sector as a whole had conducted incorrect emissions and fuel tests on their products.

On the mainland, the Shanghai Composite surged 1.85% to 2,794.71, and the smaller, technology-heavy Shenzhen Composite rocketed 2.66% higher to 1,505.63.

The increases came after fresh data out of China on Wednesday showed a 12.2% uptick in exports from the People’s Republic in July, well ahead of estimates for a 10% improvement.

Traders were largely cheering the news, as the reading was the first since Donald Trump’s punitive tariffs on China came into effect.

South Korea’s Kospi managed gains of 0.1% to 2,303.71, while the Hang Seng Index in Hong Kong rose 0.88% to 28,607.30.

On the trade front, there was little in the way of fresh news during the US session overnight, with Wall Street making minor mixed moves.

That was after Beijing confirmed late on Wednesday that it would retaliate against Washington’s fresh round of tariffs on Chinese imports.

China’s Ministry of Commerce said it would implement a 25% tariff on a list of 333 goods worth $16bn, to match in value the latest round of punitive tariffs from Trump’s administration.

“There was a lack of data overnight with the market focusing on trade tension between the US and China,” noted ANZ Research’s David Plank.

Oil prices had dipped during the US session overnight, but were rebounding late in the Asian day with Brent crude last up 0.26% at $72.47 per barrel, and West Texas Intermediate adding 0.16% to $67.05.

In Australia, the S&P/ASX 200 was 0.47% higher at 6,297.70, despite a 0.27% fall in the energy subindex after the drop in oil prices overnight.

Among the Sydney energy plays, Oil Search was flat while Santos slid 2.26% and Woodside Petroleum was off 0.36%.

Across the Tasman Sea, New Zealand’s S&P/NZX 50 was up 0.77% at 8,940.19, after the Reserve Bank of New Zealand sated market expectations by holding the country’s official cash rate at 1.75%.

The central bank’s governor Adrian Orr also confirmed in his statement that he expected rates to stay there into 2020, which would be at least one year longer than previously indicated.

Both of the down under dollars were weaker, with the Aussie last off 0.2% at AUD 1.3483 and the Kiwi retreating 1.48% to NZD 1.5040.