The MSCI Asia Pacific Index lost 1.4% to 118, closing the week up 0.5% while the MSCI ASIA APEX 50 lost 0.5% to 748 to end the week flat.
In Japan, stocks declined on concerns that international demand is weakening. The Nikkei 225 lost 2% to 9,179. Sharp declined 2.7% after news reports that the company is cutting its liquid-crystal display output. Toyota, with 30% exposure to North America, fell 1.8%. Convenience same store sales rose 0.5%y/y in July after falling 1.5% y/y in June.
A report by the Sankei newspaper indicated the Bank of Japan is considering increasing the size of its emergency credit program to US$351 billion or 30 trillion yen and lengthening loans to 6-month terms from the current 3-month terms in order to lower longer term rates. This report sent Asian markets trading higher all throughout the day as investors speculate on an easier monetary stance. (See RGE Critical Issue: Will They Won’t They? Is it Time Japan Intervened to Weaken the Yen?Yen Trends: How Has the Yen Been Behaving?). Further supporting the markets’ rally was Applied Materials stronger than expected profit forecast. The semiconductors builder said its profit for the current period will exceed analysts’ estimate of 26 cents a share by 2 to 6 cents.
The MSCI Asia Pacific Index gained 0.6% to 119 while the MSCI ASIA APEX 50 advanced 0.9% to 753.
Asian markets traded higher all throughout the day on stronger than expected U.S. industrial production data. U.S. industrial production unexpectedly rose 1% in July led by auto manufacturing, beating expectations of a 0.5% increase. (See RGE Critical Issue: U.S. Industrial Production Rises; Regional Surveys Continue to Show Weakness). Japanese auto and technology companies also posted stronger than expected earnings.
The MSCI Asia Pacific Index gained 0.2% to 118 led by Australian banks. The MSCI ASIA APEX 50 declined 0.3% to 746.
In Asia ex-Japan, a rally in Australian banks and Hong Kong developers helped lift stocks higher. Minutes of the Federal Reserve Bank of Australia August meeting fueled speculation that policymakers will not hike rates, rallying banks shares. The minutes also said banks’ loan losses seem to have peaked. In Hong Kong a successful government land sale sent developers higher. In Japan however, stocks remained under pressure on concern about Japanese growth. (See RGE Critical Issue: Japan Stuck in Transition: GDP Growth of 0.4% y/y in Q2).
The MSCI Asia Pacific Index gained 0.2% to 118 led by Australian banks. The MSCI ASIA APEX 50 rose 0.2% to 749.
Asian markets came under pressure early in the trading hours on weaker than expected Japanese GDP growth. The Japanese economy expanded at an annualized 0.4% in Q2, less than the 2.3% economists surveyed by Bloomberg anticipated and sharply down from its 4.4% growth in Q1. Export growth slowed and consumer spending stalled and as a result, GDP grew only 0.1% from Q1, the slowest among the six major economies, thus placing the Chinese economy number two after the U.S. The news sent regional stocks lower and the yen higher. (See RGE Critical Issue: Will Japan Intervene to Weaken the Yen?). Chinese stocks, however, gained after Agribank exercised its greenshoe option to sell 3.34 billion additional shares propelling its IPO to the world’s largest with $22.1 billion.
The MSCI Asia Pacific Index fell 0.1% to 117.77 while the MSCI ASIA APEX 50 gained 0.06% to 746.59.
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.