Asian equities struggled this week, but the trend reversed itself today. The stock of MS&AD Insurance Group Holdings Inc., a Japanese insurance company, rose 4.35% after reporting a 29% increase in profit for the first-quarter. Genting Singapore Plc stock increased 14.06% after reporting second-quarter net income totaling $291 million after losing money in the same period last year. Asian stocks were able to post gains despite news that initial unemployment claims continued to rise in the U.S. (See RGE Critical Issue: U.S. Labor Market: Initial Unemployment Claims Climb Higher)
The MSCI Asia Pacific Index fell 1.36% while the MSCI Asia Apex 50 rose 0.36%.
Asians stocks were down as data continues to signal a global growth slowdown. The major U.S. indices fell yesterday as the Dow Jones Industrial Average lost 2.5% and the S&P 500 retreated 2.8%. Losses in the U.S. were prompted by comments from the Federal Reserve that the economic recovery is weaker than expected. (See RGE Critical Issue: FOMC: Recovery More Modest; MBS and Agency Repayments to Be Invested in Treasurys)
Both the MSCI Asia Pacific Index and the MSCI Asia Apex 50 fell today losing 1.8% and 1.2% respectively.
Most Asian markets experienced declines on the day as investor sentiment was hampered by concern over the U.S. economy. U.S. stocks finished lower on Tuesday after the U.S. Bureau of Labor Statistics reported a 0.9% q/q in labor productivity in Q2 2010. (See RGE Critical Issue: U.S. Productivity Growth Falls Back After Five Consecutive Gains) Also, at the August 2010 Federal Open Market Committee (FOMC) meeting, the Fed noted that “the pace of the recovery is likely to be more modest in the near-term than had been anticipated” (See RGE Critical Issue: FOMC: Recovery More Modest; MBS and Agency Repayments to Be Invested in Treasurys)Both the MSCI Asia Pacific Index and the MSCI Asia Apex 50 decreased on the day losing 1.0% and 1.3% respectively.
Asian equities struggled throughout the region as Chinese trade data incited a loss of investor confidence. China’s imports increased by 22.7% in July, the smallest gain in 9 months, while exports rose by 38.1%. The modest import increase has caused concern over China’s domestic demand. Moreover the slowdown in Chinese imports has also sparked worry that the global recovery is moderating.
The MSCI Asia Pacific Index and MSCI Asia Apex 50 experienced losses today falling 0.1% and 1.5% respectively.
In Japan the NIKKEI 225 lost 0.2% to close at 9,551. The Bank of Japan decided to maintain their current policy stance by not changing interest rates in spite of a strengthening yen. Masaaki Shirakawa, Bank of Japan Governor, expressed that Japan’s economic recovery has not faltered due to yen appreciation, and thus no actions would be undertaken by the central bank at this time.
Asian stocks gained today in spite of signs pointing to a decline in the global economy. U.S. equities struggled on Friday as employment data hampered investor confidence. The Bureau of Labor Statistics (BLS) reported that U.S. payrolls fell 131,000 in July 2010, after a 221,000 decline in June (revised down from the previous 125,000). The headline number reflects a 143,000 decline in temporary census workers. (See RGE Critical Issue: U.S. Labor Market: Private Payrolls Anemic; Labor Force Decline Keeps Unemployment Rate Steady) While most Asian markets gained, Japanese stocks experienced losses on the day.
The MSCI Asia Pacific Index increased by 0.70% to 122.40 while the MSCI Asia Apex 50 advanced 0.59% to 774.37.
Although Wall Street struggled one day earlier, several Asian indices posted gains today. The major U.S. indices fell on Thursday as an increase in U.S. jobless claims dampened investor confidence. Seasonally adjusted initial unemployment claims rose by 19,000 to reach 479,000 during the week ending July 31, 2010 after a revised decrease of 8,000 in the previous week, the U.S. Department of Labor reported on August 5. (See RGE Critical Issue: U.S. Labor Market: Private Payrolls Anemic; Labor Force Decline Keeps Unemployment Rate Steady)
The MSCI Asia Pacific Index gained 0.73% to close at 121.55 while the MSCI Asia Apex 50 closed at 769.26, up 0.37% for the day.
Asian stocks performance revealed a mood of uncertainty among investors. While positive news emanated from the U.S., it was not enough to boost markets throughout the region. Although gains were seen in Japan and Australia, they were accompanied by losses in China, India, and South Korea.
The MSCI Asia Pacific Index fell 0.9% to close at 121 while the MSCI Asia Apex 50 closed at 767, down 0.05% for the day.
The performance of Asian stocks was mixed today as U.S. data releases painted a gloomy picture for the global economic outlook. Housing starts showed a 5% m/m decline in June 2010 driven by multi-family housing units. While single-family starts showed a smaller decline of 0.7% m/m, the decline in May was revised downward to show a sharp 18.8% m/m collapse following the expiration of the first-time homebuyers tax credit on April 30. Single-family permits, an indicator of future construction, signal further downside risks in the immediate months; even an eventual stabilization in starts would come at a very low level given that single family starts are a massive 19.3% below last year’s level and over 75% below the peak level of January 2006. Moreover, builder surveys continue to show deterioration in builders’ sales expectations, showing that a near-term rebound in housing construction is highly unlikely. (See RGE Critical Issue: U.S. Residential Investment: Likely to Resume Sluggish Growth in H2)
The MSCI Asia Apex 50 rose 0.06% to 766.80, and the MSCI Asia Pacific Index gained 0.89% to close at 121.76.
Asian stocks gained as investors displayed renewed confidence in the global recovery. In statements on Monday, Federal Reserve Chairman Ben Bernanke stated that consumer spending could begin to recover with increased wages. In addition, U.S. manufacturing data pointed to expansion in the sector. The Institute for Supply Management (ISM) manufacturing index registered a PMI reading of 55.5 for the month of July. Although expansion occurred in July, it decreased from June when the PMI level was 56.2. (See RGE Critical Issue: U.S. Manufacturing Activity Showing Signs of Levelling Off)
The MSCI Asia Apex 50 closed at 766.27 after rising 1.38 points or 0.18% on the day. The MSCI Asia Pacific Index also posted gains as it rose 1.33% to close at 120.69.
Most Asian markets gained as earnings reports boosted investor confidence. While the state of the global recovery continues to be uncertain, profit increases in the second quarter eased concerns. In South Korea Hyundai Mobis, the country’s largest auto-parts maker, reported a 60% increase in profit for the second quarter. Also Honda stock rose after the company announced that it had raised its 2010 profit forecast 34%.
The MSCI Asia Pacific Index lost 0.54% to finish at 119.11 while the MSCI Asia Apex 50 rose 1.81% to close at 764.65.