Asia report: Markets rise as Japan exports surge, Australia-NZ border opens

Most stock markets in Asia closed in positive territory on Monday, with China leading the gains as investors monitored the Covid-19 situation in the region.

In Japan, the Nikkei 225 eked out gains of 0.01% to 29,685.37, as the yen strengthened 0.69% against the dollar to last trade at JPY 108.05.

Automation specialist Fanuc was up 0.61%, while among the benchmark’s other major components, fashion firm Fast Retailing was down 0.99% and technology conglomerate SoftBank Group was 0.74% weaker.

The broader Topix index lost 0.22% by the end of trading, closing the session as 1,956.56.

In fresh data out of Tokyo, exports from Japan surged 16.1% year-on-year in March, swinging from February’s fall of 4.5% and beating consensus expectations for a rise of 11.4%.

“Chinese and Korean trade figures had suggested a strong pick-up in exports m/m in March, but these data reveal just how robust that was,” said Pantheon Macroeconomics chief Asia economist Freya Beamish.

“In fact, our model implies an even sturdier picture than the official adjustment, with a rise of 6.3%, after a fall of 1.4% in February.

“Exports to China were the standout performer, with the EU a close second, and a still strong performance from exports to the United States too.”

Beamish said the picture was “less impressive” in real terms, but exports still rose 3.4%, more than making up for the 2.8% drop in February.

“Nevertheless, real quarter-on-quarter growth of exports slowed, while that of imports picked up.

“That leaves the net export contribution to real GDP growth likely down substantially in the first quarter, at about 0.8 percentage points, from the 2.6 point contribution in the fourth quarter.”

Japan’s trade appeared to be lagging behind the story in China and Korea, as was often the case, Beamish quipped.

“Korean 10-day exports from this month suggest a weakening at the margin, after strength in the first quarter.”

On the mainland, the Shanghai Composite gained 1.49% to 3,477.55, and the smaller, technology-heavy Shenzhen Composite leapt 2.44% to 2,274.36.

South Korea’s Kospi inched ahead 0.01% to 3,198.84, while the Hang Seng Index in Hong Kong was 0.47% firmer at 29,106.15.

Shares of Chinese internet behemoth Alibaba were down 1.53% in the special administrative region, however, after reports that its financial affiliate Ant Group was seeking an exit for the conglomerate’s founder Jack Ma amid pressure from Beijing authorities.

The company refuted the claims in a tweet, however, describing the weekend report from Reuters as “untrue and baseless”, adding that nobody had held discussions around Ma divesting his stake.

It was a mixed session for the rest of Hong Kong’s technology sector, with Baidu up 1.74% and Tencent falling 0.79%.

Online travel agency group Trip.com, which counts the UK’s TrainPal app among its assets, was in focus after leaping more than 4% from its issue price on its market debut.

The blue-chip technology stocks were mixed in Seoul, with Samsung Electronics down 0.72%, while SK Hynix rose 0.36%.

Oil prices were lower at the end of the Asian day, with Brent crude last down 0.26% at $66.60 per barrel and West Texas Intermediate falling 0.19% to $63.01.

In Australia, the S&P/ASX 200 was 0.3% higher at 7,065.60, with the consumer discretionary sector squeezing out gains of 0.05% as the country opened its borders to tourism to and from New Zealand.

It was the first time non-citizens have been able to visit each country without restriction in about a year, as New Zealand and Australia almost completely closed their borders to all but a very restricted flow of returning citizens as the world grappled with the Covid-19 pandemic.

The country’s flag carrier Qantas was down 1.93%, however, even as full quarantine-free flights began between the south Pacific neighbours.

Across the Tasman Sea, New Zealand’s S&P/NZX 50 rose 0.66% to 12,767.83, with airport operator AIAL up 4.7% and Air New Zealand rising 1.1% as the borders opened to Australians.

The so-called ‘trans-Tasman travel bubble’ allows travellers from either country to visit the other without going through a mandatory quarantine, which both nations have implemented for all other arrivals through the pandemic.

Both New Zealand and Australia’s tourism and seasonal and casual employment sectors are reliant on one another, as they share a freedom of movement arrangement similar to EU states.

Both of the down under dollars were stronger on the greenback, with the Aussie last ahead 0.67% at AUD 1.2850, and the Kiwi advancing 0.95% to NZD 1.39.