Asia report: Markets mixed following positive trade comments from China
Markets in Asia finished in a mixed state on Friday, as investors digested mixed messages on the US-China trade front, and the Bank of Korea sated expectations by standing pat on interest rates.
AUD/USD
$0.6406
13:14 19/04/24
GBP/NZD
NZD2.1134
13:14 19/04/24
Hang Seng
16,224.14
10:21 19/04/24
Nikkei 225
37,068.35
09:44 19/04/24
USD/JPY
¥154.5905
13:14 19/04/24
In Japan, the Nikkei 225 was up 1.19% at 20,704.37, as the yen strengthened 0.11% against the dollar to last trade at JPY 106.40.
Of the major components on the benchmark index, automation specialist Fanuc was up 2.73% and technology conglomerate SoftBank Group added 2.9%, while fashion firm Fast Retailing was down 0.53%.
The broader Topix index was 1.46% higher by end of trading in Tokyo, to close at 1,511.86.
On the mainland, the Shanghai Composite was 0.16% weaker at 2,886.24, and the smaller, technology-heavy Shenzhen Composite was 0.74% lower at 1,579.25.
South Korea’s Kospi advanced 1.78% to close at 1,967.79, while the Hang Seng Index in Hong Kong managed gains of 0.08% to 25,724.73.
Both of the blue-chip technology stocks were in the green in Seoul, with Samsung Electronics ahead 1.38%, and chipmaker SK Hynix surging 5.59%.
The Bank of Korea left its benchmark interest rate alone in its latest policy decision on Friday, which was in line with market expectations.
It left its seven-day base rate at 1.50%, having cut it to that level in its first easing decision in three years in July.
Looking ahead, Reuters reported that most of the analysts it surveyed were expecting further easing at the next meeting, to a joint record low of 1.25%.
Sentiment began strong at the start of the Asian day, following comments out of Beijing on Thursday that China’s Ministry of Commerce was keen to resolve the ongoing trade war with the United States in a “calm” way.
Ministry spokesman Gao Feng said in a statement that the country’s administration rejected an escalation of tensions, and wanted to negotiate in a collaborative way to solve the two economic superpowers’ differences.
Analysts weren’t entirely convinced by the comments from China, however, with IG’s Jingyi Pan warning that it matched up with the theory that Beijing was wanting to delay a deal until next year’s federal elections in the US - even though it was a “temporary relief” for global markets.
“This could still make for prolonged trade uncertainty,” Pan noted.
Across the Pacific, meanwhile, the US Treasury yield curve inversion continued, with the 10-year note yield remaining below that of the two-year bond.
The ‘inversion’ phenomenon has had a number of market watchers on edge, as it is considered by many to be a precursor to a recessionary period in the US.
Oil prices were lower as the region entered the weekend, with Brent crude last down 0.43% at $60.82 per barrel, and West Texas Intermediate off 0.84% at $56.24.
In Australia, the S&P/ASX 200 was 1.49% stronger at 6,604.20, while across the Tasman Sea, New Zealand’s S&P/NZX 50 was ahead 1.6% at 10,757.20.
Both of the down under dollars were weaker on the greenback, with the Aussie last off 0.11% at AUD 1.4879, and the Kiwi retreating -.13% to NZD 1.5864.