Asia report: Markets mixed as China data disappoints

Markets across the Asia-Pacific region ended mixed with little changes on Tuesday, as investors reacted to a string of disappointing economic data releases from China.

Key indicators including retail sales, industrial production, and fixed asset investment all fell short of market consensus expectations, stirring volatility across regional markets.

“Asian equities have had a mixed trading session overnight, with the positive momentum from Wall Street failing to be sustained,” said TickMill market analyst Patrick Munnelly.

“US regional banks experienced a short squeeze, driving stocks higher.

“However, the upside was limited due to concerns over the debt ceiling and a disappointing NY Fed manufacturing survey.”

Munnelly also noted that Asian market sentiment was impacted by weaker-than-expected Chinese activity data.

“The mainland Chinese market remained subdued after disappointing industrial production, retail sales, and fixed assets urban investment all fell short of analysts' forecasts.

“Furthermore, it was reported overnight that Michael Burry, known for his 'Big Short' fame, increased his bullish bets on e-commerce giants JD.com and Alibaba.”

Markets mixed as investors digest slew of China data

In Japan, the Nikkei 225 closed 0.73% higher at 29,842.99 points, while the broader Topix index advanced 0.58% to 2,127.18 points.

Kajima Corporation, Advantest Corporation, and T&D Holdings were among the day's top performers on Tokyo’s benchmark, gaining 6.04%, 5.52%, and 5.08%, respectively.

Mainland Chinese markets meanwhile slipped into negative territory, with the Shanghai Composite falling 0.6% to 3,290.99 points and the Shenzhen Component dropping 0.71% to 11,099.26 points.

China Hi-Tech and CIG ShangHai were hit the hardest in Shanghai, both plummeting over 10%.

In Hong Kong, the Hang Seng Index closed marginally higher, up 0.04% at 19,978.25 points.

Xinyi Solar, JD.com, and Baidu led the gains, advancing 5.33%, 4.04%, and 2.81%, respectively.

The South Korean Kospi also saw a slight uptick, finishing the day up 0.04% at 2,480.24 points, with SK Hynix and SK Bioscience outperforming by a respective 4.63% and 3.66%.

In contrast, Australia's S&P/ASX 200 closed down 0.45% at 7,234.70 points, with Eagers Automotive and HUB24 among the biggest losers, falling 5.92% and 4.94%, respectively.

New Zealand's S&P/NZX 50 finished the session slightly up by 0.07% at 11,945.87 points.

Oceania Healthcare and Arvida were the day's top gainers, increasing 4.41% and 2.83%, respectively.

In the foreign exchange market, the yen was last 0.3% stronger on the dollar at JPY 135.71, while the Aussie weakened 0.15% to trade at AUD 1.4947.

The Kiwi was 0.13% stronger on the greenback to change hands at NZD 1.6001.

Meanwhile, oil prices edged lower, with Brent crude futures last down 0.36% on ICE at $74.96 per barrel, and the NYMEX quote for West Texas Intermediate slipping 0.38% to $70.84.

Data suggests roadblock in China’s economic recovery journey

In economic news, China's recovery saw signs of faltering in April, with key data points underperforming economist predictions.

Retail sales experienced a year-on-year increase of 18.4%, falling short of the anticipated 21% boom.

Industrial production also missed the mark, growing only 5.6% compared to the 10.9% projected by experts in Reuters polling.

It was, however, a slight increase from a 3.9% rise in March, following a downbeat start to the year.

Fixed asset investment, meanwhile, only rose by 4.7% against a forecast of 5.5%.

“China is likely to step up targeted easing in the second quarter, in the form of low-cost loans for weak sectors, such as SMEs, and policy bank funding for fixed asset investment,” said Pantheon Macroeconomics chief China economist Duncan Wrigley.

“Local-level property easing probably will be stepped up, including lower mortgage rates under the dynamic mortgage rate mechanism, but also incremental relaxation of purchase restrictions.

“The People’s Bank of China’s first-quarter report seems to have ruled out broader rate cuts for now, but we think they are still on the table if the recovery shows signs of further significant weakening going into the second half.”

Elsewhere, the release of the minutes from the Reserve Bank of Australia's (RBA) recent meeting suggested that future rate hikes could be on the way, depending on economic and inflationary data trends.

Despite market anticipation to the contrary, the RBA raised rates by 25-basis points on 2 May , bringing its cash rate to 3.85%.

The central bank said the hike was justified by data from April which indicated a “tight labour market and significant inflationary pressures,” according to its board.

Ratesetters were concerned that the risks could further postpone the return of inflation to its target.

Australian consumer sentiment meanwhile showed signs of a downturn this month, with the Westpac-Melbourne Institute index slipping 7.9% to 79 in May, from 85.8 in April.

The decline was put down to the RBA's unexpected rate hike, and a "mildly disappointing" national budget, resulting in "deep pessimism" among consumers.

Reporting by Josh White for Sharecast.com.

NIKKEI 225 +216.65 (+0.73%) 29,842.99

RISERS
Kajima Corporation +6.04% JPY 2,000.0
Advantest Corporation +5.52% JPY 12,810.0
T&D Holdings +5.08% JPY 1,884.0
Tokyo Electron +4.23% JPY 16,860.0
Nippon Paper Industries +3.64% JPY 1,140.0

FALLERS
Konica Minolta -8.86% JPY 494.0
Dentsu -8.27% JPY 4,550.0
Sumitomo Dainippon Pharma -7.09% JPY 747.0
Japan Post Holdings -6.89% JPY 1,060.5
Mitsui Engineering & Shipbuilding -5.86% JPY 514.0

SHANGHAI COMPOSITE -19.75 (-0.6%) 3,290.99

RISERS
Deluxe Family +9.96% CNY 3.09
China Resources Double-Crane Pharmaceutical +6.3% CNY 19.90
China Shipbuilding Industry Group Power +6.17% CNY 19.79
China Building +5.33% CNY 12.64
Hongda +5.11% CNY 3.70

FALLERS
China Hi-Tech -10.02% CNY 7.63
CIG ShangHai A -10.01% CNY 54.32
China Reform Culture Holdings -10% CNY 15.57
Inly Media -10% CNY 10.62
CSSC Steel Structure Engineering -9.98% CNY 22.55

HANG SENG INDEX +7.12 (0.04%) 19,978.25

RISERS
Xinyi Solar +5.33% HKD 8.30
JD.com +4.04% HKD 146.80
Baidu +2.81% HKD 124.30
Hansoh Pharmaceutical Group +1.83% HKD 13.34
ENN Energy +1.78% HKD 114.10

FALLERS
Country Garden Holdings -5% HKD 1.71
Orient Overseas International -3.33% HKD 153.80
Wharf Real Estate -3.03% HKD 4.65
Tingyi -2.74% HKD 12.80
China Resources Beer Holdings -2.39% HKD 55.20

KOSPI 100 +7.72 (+0.32%) 2,449.13

RISERS
SK Hynix +4.63% KRW 90,400
SK Bioscience +3.66% KRW 79,300
Doosan Heavy Industries & Construction +2.86% KRW 15,820
POSCO Future M +2.14% KRW 310,000
Meritz Financial +2.12% KRW 45,700

FALLERS
Hankook Tire -4.59% KRW 35,300
Lotte -4.46% KRW 28,900
Hanmi Science -3.33% KRW 37,700
Kepco -3.11% KRW 18,680
Kia Corporation -3% KRW 87,300

S&P/ASX 200 -32.40 (-0.45%) 7,234.70

RISERS
James Hardie Industries +8.27% AUD 36.80
Contact Energy +3.63% AUD 7.42
TELIX Pharmaceuticals +2.62% AUD 11.36
Nanosonics +2.55% AUD 5.23
Reliance Worldwide Corporation +1.45% AUD 4.20

FALLERS
Eagers Automotive -5.92% AUD 13.34
HUB24 -4.94% AUD 26.56
Netwealth Group -4.27% AUD 13.02
ARB Corporation -3.62% AUD 30.88
Liontown Resources -3.412% AUD 2.83

S&P/NZX 50 +8.27 (+0.07%) 11,945.87

RISERS
Oceania Healthcare +4.41% NZD 0.71
Arvida +2.83% NZD 1.09
Fletcher Building +1.24% NZD 4.91
Kiwi Property +1.12% NZD 0.905|
Vector +1.01% NZD 4.02

FALLERS
Eroad -3.57% NZD 0.54
Scales Corporation -3.23% NZD 3.30
Pacific Edge -2.33% NZD 0.42
Manawa Energy -1.61% NZD 4.90
Stride Property -1.53% NZD 1.29