(ATF) Asian markets were broadly lower as investor focus shifted back to economic data and corporate earnings as the initial euphoria around delivery of a coronavirus vaccine faded. The deadlock in Washington over a further stimulus package is also keeping the mood gloomy.
Gold edged up and was up 0.4% at $1,930 per ounce and US Treasuries were firm with the 10-year yield down one basis point at 0.66%. The dollar was weak against a basket of currencies to trade at 93.14.
But Japan’s index jumped after the world’s third-largest economy revealed positive economic data.
Japan’s Nikkei index soared 1.78% after the BOJ released data that showed PPI was up 0.6% in July, beating expectations of 0.3% rise and matching the previous month’s increase.
Also released during the day was data that showed Australian employment growth in July surpassed expectations, but analysts said the road ahead is challenging.
The consensus view for July employment growth was around 30,000, but the actual increase was 114,700 jobs.
“The likelihood is that job gains will be much harder to generate in the coming months - June and July can be viewed as the easy gains following re-opening,” Robert Carnell, ING Bank’s regional head of research for the Asia-Pacific. “But the economy is still operating far from 'business as usual', and further gains in the months ahead, coupled with tighter income support will continue to weigh on household finances and spending.”
Australia’s S&P/ASX 200 benchmark fell 0.67% after poor earnings from Telstra, AMP and AGL dragged down the index.
Meanwhile, China’s CSI 300 index dipped 0.26% and Hong Kong’s Hang Seng Index ended flat, as investors awaited earnings announcements and caution prevailed ahead of a Sino-US video conference on August 15 to talk about bilateral issues and the phase-1 trade deal signed in January.
Looking ahead, investors are cautious ahead of the Sino-US video conference on Saturday given the flurry of negative news in recent weeks. Trump has taken an aggressive position and markets are bracing for a Beijing reaction.
“We view China differently than we did eight months ago,” Trump said at a briefing. “I do not know if we want to have a deal with China.”
ATF China Bond 50 Index: Declining bank profits pull down bonds of banks, SOEs
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Foreign Exchange: In-depth yuan report tomorrow (Friday).
# Japan’s Nikkei 225 index jumped 1.78%
# Australia’s S&P ASX 200 eased 0.67%
# Hong Kong’s Hang Seng index ended flat
# China’s CSI300 retreated 0.26%
# The MSCI Asia Pacific index added 0.73%.
Stock of the day
China Unicom , the country’s second-biggest mobile-phone operator, surged 25% after reporting better results and an improved outlook. “The company will seize the historical opportunity of the unique group-level mixed-ownership reform to introduce new efficiency, new vitality and new edges, unlocking the maximum benefits from the reform,” chairman and CEO Wang Xiaochu said. "The huge demand for intelligent and digital transformation in various industries will bring enormous potential for corporate development.”