Asian Shares Mixed After U.S. Rally

Asian stocks ended mixed on Wednesday as investors digested upbeat economic data from the U.S. and China and reacted to the comments from U.S. House Speaker Nancy Pelosi suggesting “serious differences” over a coronavirus aid package.

China’s Shanghai Composite Index dipped 5.81 points, or 0.2 percent, to 3,404.80 after U.S. Secretary of State Mike Pompeo said the Trump administration will take further moves in the coming days and weeks to restrict the activities of Chinese firms for the benefit of the American economy. Hong Kong’s Hang Seng Index eased 0.3 percent to end at 25,120.09.

Japanese shares advanced as Chief Cabinet Secretary Yoshihide Suga gathered support to be the next prime minister at a leadership election on September 14 and Bank of Japan Deputy Governor Masazumi Wakatabe said the central bank should consider ways to improve its monetary policy.

The Nikkei 225 Index climbed 109.08 points, or 0.5 percent, to 23,247.15, while the broader Topix index closed 0.5 percent higher at 1,623.40. Electronic parts makers Keyence Corp. and Murata Manufacturing jumped 3-4 percent. Market heavyweight SoftBank Group rose about 1 percent.

Australian markets rallied after three days of losses. Investors shrugged off data showing that the economy has plunged into its first recession in nearly 30 years.

The benchmark S&P/ASX 200 Index rallied 109.80 points, or 1.8 percent, to 6,063.20, while the broader All Ordinaries Index ended up 108.60 points, or 1.8 percent, at 6,251.80.

Miners BHP, Fortescue Metals Group and Rio Tinto rose between 1.6 percent and 2.7 percent. QBE Insurance Group advanced 1.7 percent after the departure of its CEO, Pat Regan.

Buy-now-pay-later firm Afterpay fell 1.9 percent after payments giant Paypal announced a product called ‘Pay in 4.’ Zip slumped 11.6 percent after completing its acquisition of QuadPay.

Australia’s GDP declined a seasonally adjusted 7.0 percent in the second quarter of 2020, the Australian Bureau of Statistics said. That missed expectations for a fall of 5.9 percent following the 0.3 percent decline in the three months prior, sending the country into recession.

On a yearly basis, GDP dropped 6.3 percent versus forecasts for a decline of 5.2 percent after rising 1.4 percent in the first quarter.

Seoul stocks rose as manufacturing data from major economies fueled hopes of a global recovery. The benchmark Kospi advanced 14.82 points, or 0.6 percent, to 2,364.37 as the country’s finance minister said the government will need to give second cash handouts to some households to ease the economic impact of the coronavirus outbreak.

In economic news, consumer prices in South Korea were up 0.6 percent in August, Statistics Korea said. That exceeded expectations for an increase of 0.2 percent following the flat reading in July.

On a yearly basis, consumer prices climbed 0.7 percent – again beating forecasts for 0.4 percent and up from 0.3 percent in the previous month.

New Zealand shares advanced after Reserve Bank governor Adrian Orr reiterated that the central bank was preparing additional steps to stimulate the economy. The benchmark NZX-50 Index climbed 109.82 points, or 0.9 percent, to 11,902.98.

New Zealand’s merchandise terms of trade climbed a seasonally adjusted 2.5 percent in the second quarter of 2020, Statistics New Zealand said in a report today. That beat forecasts for an increase of 0.9 percent following the 0.7 percent decline in the three months prior.

U.S. stocks notched fresh record highs overnight as strong Chinese factory activity data signaled rising global demand for exports and another report showed manufacturing activity in the U.S. expanded at a faster rate in August.

The tech-heavy Nasdaq Composite climbed 1.4 percent and the S&P 500 added 0.8 percent to reach fresh record closing highs, while the Dow Jones Industrial Average advanced 0.8 percent.

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