Asia report: Markets rise ahead of US Fed meeting

Investors were looking to the meeting for some clues as to the central bank’s interest rate trajectory, after stronger-than-expected inflation data from the US last Friday.

“In early trading, the yen experienced significant volatility, rallying strongly after reaching its lowest point in 34 years,” said TickMill market analyst Patrick Munnelly.

“Initially dropping below the JPY 160 per dollar mark for the first time since 1990, the yen's decline was attributed to thin liquidity due to a public holiday in Japan.”

However, Munnelly noted that it had since staged a partial recovery, hinting at possible intervention by Japanese authorities to bolster the currency.

“Meanwhile, equities in the Far East are generally seeing supportive sentiment.”

Markets in the green across the region

In Japan, markets remained closed for the Shōwa Day holiday, marking the start of the country’s ‘Golden Week’.

Meanwhile, in China, both the Shanghai Composite and Shenzhen Component indices experienced gains, with the former rising 0.79% to 3,113.04, while the latter added 2.22% to 9,673.76.

Leading gainers in Shanghai included Anji Microelectronics Tech, China Fortune Land Development, and Beijing Dalong Weiye Real Estate Development, which saw increases of 16.54%, 10.28%, and 10.13% respectively.

Hong Kong's Hang Seng Index also ended positively, advancing by 0.54% to 17,746.91, led higher by Country Garden Services, up 11%; Longfor Properties, ahead 7.09%; and AIA Group, which increased 6.11%.

South Korea's Kospi index saw an uptick of 1.17% to 2,687.44, with the top performers including Hanwha Solutions, Lotte Chemical, and Kumho Petro Chemical, with increases of 13.61%, 7.7%, and 7.54% respectively.

Australia's S&P/ASX 200 index also experienced positive momentum, rising by 0.81% to 7,637.40, led higher by Boss Energy, up 9.13%; Liontown Resources, ahead 8.04%; and Pexa Group, which gained 6.39%.

Across the Tasman Sea, New Zealand’s S&P/NZX 50 index closed 0.94% higher to 11,916.24, led higher by Kiwi Property Group, Infratil, and Ryman Healthcare, with increases of 3.09%, 3.06%, and 2.65% respectively.

On the currency front, the dollar was last down 1.53% on the yen, trading at JPY 155.91.

The greenback meanwhile declined 0.34% against the Aussie, reaching AUD 1.5254, while it retreated 0.37% from the Kiwi to change hands at NZD 1.6771.

In oil markets, Brent crude futures were last down 0.68% on ICE at $88.89 per barrel, while the NYMEX quote for West Texas Intermediate declined 0.43% to $83.49.

Industrial profits face a setback in China

In economic news, China's industrial sector faced a setback in March, signalling a slowdown in growth for the first quarter of the year compared to the same period last year.

According to fresh data, industrial profits in the country rose by 4.3% year-on-year for the January to March period, a notable deceleration from the 10.2% gain recorded in the combined January and February period.

Typically, China reports its industrial profits data on a year-to-date basis, combining economic data from January and February into a single reading.

However, according to CNBC, a Goldman Sachs report showed a stark contrast in March, revealing a 4% decline in industrial profits and a 1.3% decrease in revenue compared to the same month last year.

That downturn contrasted sharply with the robust 10.2% increase in profits and 4.5% increase in revenue observed in the combined January-February period.

Reporting by Josh White for Sharecast.com.