Asia report: Markets mixed on Japan data, debt ceiling doubts

Asia-Pacific stock markets displayed a mixed performance at the close of trading on Wednesday, as investors analysed data from Australia and Japan.

Market participants were also closely watching developments across the Pacific, as talks between the White House and the US Congress continued ahead of the looming federal debt ceiling deadline.

“Asian equity markets put in another mixed performance overnight, as caution prevailed in the region due to the negative handover from Wall Street,” said TickMill Group market analyst Patrick Munnelly.

“Concerns over the debt ceiling clouded risk appetite in the US, although the meeting between President Biden and congressional leaders was described as productive, but without any major breakthroughs.

“The meeting did, however, set the stage for further discussions.”

Munnelly noted that Japan’s benchmark outperformed, surpassing the 30,000 handle for the first time since September 2021.

“Sentiment was bolstered by stronger-than-expected Japanese GDP data.”

Markets mixed amid data dump, debt-ceiling disquiet

In Japan, the Nikkei 225 rose 0.84% to close at 30,093.59, while the broader Topix index gained 0.3% to finish at 2,133.61.

Notable performers on Tokyo’s benchmark included SoftBank Group, Dainippon Screen Manufacturing, and Advantest, which saw their shares increase by 4.82%, 3.61%, and 3.51% respectively.

Mainland China markets experienced slight declines, with the Shanghai Composite falling by 0.21% to 3,284.23, and the Shenzhen Component marginally down 0.07% at 11,091.08.

Shares of China Reform Culture Holdings and China Science Publishing & Media both suffered significant losses in Shanghai, dropping by 10.02% and 10% respectively.

Hong Kong's Hang Seng Index experienced a considerable drop of 2.09% to end at 19,560.57.

Country Garden Services, Longfor Properties, and Zhongsheng were among the worst hit, with their shares falling 7.71%, 7.13%, and 6.03% respectively.

South Korea's Kospi, however, showed a positive performance, increasing 0.58% to close at 2,494.66.

LG Display and LG Energy Solution led the gains, with their shares rising by 3.75% and 3.7% respectively.

The Australian S&P/ASX 200 saw a decrease of 0.49%, ending the day at 7,199.20.

Shares of Incitec Pivot and Core Lithium saw significant declines, falling by 7.84% and 5.58% respectively.

New Zealand's S&P/NZX 50 managed a slight increase of 0.05% to close at 11,951.66.

Serko was the star performer in Wellington, rocketing 29.13%, while Oceania Healthcare also saw a substantial gain of 5.63%.

In currencies, yen and the Aussie were both weaker against the dollar, falling 0.44% and 0.06% respectively to last trade at JPY 136.99 and AUD 1.5034.

The Kiwi, however, was stronger on the greenback, last advancing 0.31% to change hands at NZD 1.5999.

Oil prices experienced a modest increase, with Brent crude futures last up 0.47% on ICE at $75.26 per barrel, and the NYMEX quote for West Texas Intermediate rising 0.49% to $71.21.

Japan’s economy grows beyond forecasts, Australia’s wage-price index rises

On the economic front, Japan's economy delivered an unexpected boost in the first quarter of the year, surpassing expectations, with annualised growth of 1.6% according to fresh official data.

Economists polled by Reuters had projected a more modest growth rate of 0.7%.

On a quarterly basis, the economy also outpaced projections with growth of 0.4% - four times the 0.1% economists had pencilled in.

“The Bank of Japan will no doubt cheer the improvement in Japanese growth performance, but it is too soon to pop the champagne corks,” said Duncan Wrigley at Pantheon Macroeconomics.

“The Japanese economy has oscillated between growth and decline since it began reopening tentatively in 2021.”

Wrigley noted that 2021 and 2022 each saw two quarters of sequential growth, and two of decline.

“The domestic economy has not yet shifted decisively into a self-sustaining recovery cycle.

“Moreover, the second-half global outlook is darkening, with an increasing risk of a US recession, the collapse in German factory orders, and the Chinese reopening recovery in danger of stalling.”

In Australia, the wage price index for the first quarter saw a year-on-year rise of 3.6% - an increase from the previous period's annualised rise of 3.3%.

However, quarter-on-quarter growth in the index was slightly below expectations, increasing by 0.8% compared to the predicted 0.9% growth.

In political developments, the upcoming Quad leaders' summit in Sydney, which was set to host representatives from the US, India, and Japan on 24 May, was confirmed to be cancelled.

The announcement, from Australian prime minister Anthony Albanese, came after US president Joe Biden decided to cut short his Asia trip to return to Washington for urgent debt ceiling negotiations.

Finally on data, Singapore reported mixed results in non-oil domestic exports in April, with a month-on-month growth rate of 2.7%, defying economist predictions of a 3% contraction.

However, the year-on-year figures showed a decrease of 9.8% - slightly more than the forecast 9.4% drop.

That was put down to reduced exports to China, Taiwan, and Malaysia, despite growing exports to the US, the European Union, and South Korea.

Singapore's total trade saw a significant year-on-year decrease of 18.8% in April, to SGD 100.3bn (£59.96bn), extending the 8.6% decrease from March.

Compared to April last year, both total exports and imports saw contractions of 18.1% and 19.5%, respectively.

Reporting by Josh White for Sharecast.com.

NIKKEI 225 +250.6 (+0.84%) 30,093.59

RISERS
SoftBank Group Corporation +4.82% JPY 5,240.0
Dainippon Screen Manufacturing +3.62% JPY 12,580.0
Advantest Corporation +3.51% JPY 13,260.0
Tokyo Electron +3.32% JPY 17,420.0
Fukuoka Financial Group +3.15% JPY 2,686.0

FALLERS
Sumitomo Dainippon Pharma -5.22% JPY 708.0
Yaskawa Electric Corporation -4.19% JPY 5,490.0
Nippon Sheet Glass -3.89% JPY 643.0
Sumitomo Chemical -3.83% JPY 427.0
Konica Minolta -3.64% JPY 476.0

SHANGHAI COMPOSITE -6.76 (-0.21%) 3,284.23

RISERS
Hanma Technology +10.07% CNY 8.31
Guangxi Guidong Electric Power +10.03% CNY 3.51
Beijing Tricolor +10.01% CNY 25.53
Harbin Pharmaceutical Group +10% CNY 3.85
CSSC Offshore & Marine Engineering Group +10% CNY 30.81

FALLERS
China Reform Culture Holdings -10.02% CNT 14.01
China Science Publishing & Media -10% CNY 37.53
China TV Media -9.99% CNY 17.47
Anhui Xinhua Media -9.97% CNY 8.13
China Hi-Tech -9.96% CNY 6.87

HANG SENG INDEX -417.68 (-2.09%) 19,560.57

RISERS
Hengan International Group +2.41% HKD 36.05
SMIC 0% HKD 20.40
CK Infrastructure -0.21% HKD 46.60
Alibaba -0.35% HKD 85.45
Baidu -0.4% HKD 123.80

FALLERS
Country Garden Services -7.71% HKD 10.06
Longfor Properties -7.13% HKD 18.62
Zhongsheng -6.03% HKD 31.95
Xinyi Glass -5.55% HKD 12.60
Country Garden Holdings -5.26% HKD 1.62

KOSPI 100 +10.98 (+0.45%) 2,460.11

RISERS
LG Display +3.75% KRW 15,770
LG Energy Solution +3.7% KRW 560,000
SK IE Technology +3.58% KRW 84,000
Samsung SDI +2.98% KRW 691,000
SK Innovation +2.88% KRW 182,100

FALLERS
Orion -5.45% KRW 135,200
SD Biosensor -2.83% KRW 17,880
HMM -2.66% KRW 18,300
Doosan -1.56% KRW 50,500
Kogas -1.55% KRW 25,450

S&P/ASX 200 -35.50 (-0.49%) 7,199.20

RISERS
SkyCity Entertainment Group +3.77% AUD 2.20
Infratil +3.72% AUD 9.20
Domain Holdings Australia +2.13% AUD 3.36
AGL Energy +1.92% AUD 9.01
Xero +1.85% AUD 94.10

FALLERS
Incitec Pivot -7.84% AUD 2.94
Core Lithium -5.58% AUD 1.10
Sandfire Resources -4.86% AUD 5.87
Sayona Mining -4.44% AUD 0.215
Coronado Global Resources -3.62% AUD 1.465

S&P/NZX 50 +5.79 (+0.05%) 11,951.66

RISERS
Serko +2.913% NZD 2.97
Oceania Healthcare +5.63% NZD 0.75
Ryman Healthcare +4.44% NZD 5.64
Vista Group +3.73% NZD 1.39
Arvida +3.67% NZD 1.13

FALLERS
Eroad -1.85% NZD 0.53
Argosy Property -1.8% NZD 1.09
Restaurant Brands NZ -1.75% NZD 7.30
Kiwi Property -1.66% NZD 0.89
Air New Zealand -1.3% NZD 0.76