Asia report: Markets mixed as PBOC pours cash into banking system
Markets in Asia finished in a mixed state on Thursday, as the Chinese central bank injected a massive amount of cash into that country’s banking system, and after a decent session on Wall Street overnight amid the US earnings season.
In Japan, the Nikkei 225 was down 0.1% at 20,402.27, as the yen strengthened 0.3% against the dollar to last trade at JPY 108.76.
The broader Topix index was up 0.35% in Tokyo, closing at 1,543.20.
On the mainland, the Shanghai Composite lost 0.42% to 2,559.64, and the smaller, technology-heavy Shenzhen Composite slipped 0.94% to 1,309.14.
China’s banking system received a fresh stimulus late on Wednesday, after the People’s Bank of China shifted CNY 560bn into the sector.
The amount set a new one-day record for the central bank, with an official statement saying that liquidity in the banking system was declining rapidly as it was the “peak of the tax period”.
Analysts at OCBC Bank in Singapore said the move helped to alleviate concerns of a possible funding squeeze ahead of the Chinese New Year and its accompanying extended holiday in the Greater China region.
South Korea’s Kospi eked out gains of 0.05% to 2,107.06, while the Hang Seng Index in Hong Kong slid 0.54% to 26,755.62.
Sentiment was given a lift early in the session after UK prime minister Theresa May narrowly survived a motion of no confidence against her government in the House of Commons.
The vote, called by opposition leader Jeremy Corbyn, came a day after May’s Brexit deal with the European Union was voted down in the worst defeat of a sitting government in British history.
May still faced the mammoth job of coming up with a solution to satisfy all sides ahead of the expiry of the UK’s Article 50 withdrawal notice on 29 March, with the prime minister calling for cross-party discussion on Thursday.
There was also some cheer spreading from across the Pacific Ocean, after stocks on Wall Street rose amid strong quarterly earnings reports from Bank of America and Goldman Sachs.
Oil prices were lower as the region went to bed, with Brent crude last down 0.76% at $60.26 per barrel, and West Texas Intermediate losing 2.01% to $51.24.
In Australia, the S&P/ASX 200 managed gains of 0.26% to 5,850.10, while across the Tasman Sea, New Zealand’s S&P/NZX 50 rose 0.6% to settle at 9,077.81.
The down under dollars were in a mixed state against the greenback, with the Aussie last 0.03% stronger at AUD 1.3948, and the Kiwi weakening 0.46% to NZD 1.4825.