Asian stocks advance despite weaker factory data and outbreaks
BANGKOK (AP) – Shares were mostly higher in Asia on Wednesday despite new data showing that plant activity slowed this month as virus outbreaks disrupted shipping at some Chinese ports.
Markets rose in Shanghai, Sydney and Seoul but fell in Tokyo and Hong Kong.
Japan, South Korea and China all released data that “has been slightly disappointing,” OANDA’s Jeffrey Halley said in a comment, adding that “it looks like a slowdown in demand from major markets for export, exacerbated by chip shortages and logistics bottlenecks, are canceling orders in many sectors. “
Japan’s industrial production fell 5.9% in June from the previous month, while South Korean production fell 0.7%.
A key measure of Chinese factory activity, the purchasing managers index, has barely remained in a state of expansion.
Pandemic precautions due to coronavirus outbreaks in some southern Chinese ports have disrupted shipping, analysts said.
There are signs of weakness that may reassure investors who fear central banks and governments may withdraw the lavish support from markets that propelled them to record highs after a collapse at the start of the pandemic.
Tokyo’s Nikkei 225 index was down 0.1% to 28,791.53. In Seoul, the Kospi gained 0.4% to 3,300.33 and the Shanghai Composite index gained 0.3% to 3,584.06. Sydney’s S & P / ASX 200 climbed 0.4% to 7,330.50.
In Hong Kong, the Hang Seng Index fell 0.4% to 28,879.87. Shares rose in India and Taiwan.
The biggest data release this week will be Friday’s US employment report for June. Economists expect it to show that US employers have created 675,000 more jobs than they have cut, with the unemployment rate falling to 5.7%.
Job growth has been choppy recently, with disappointing gains below economists’ expectations in recent months. This is essential because the Fed is likely to maintain its support for the economy through low interest rates as long as the labor market appears to need help.
Pending Friday’s update, markets were listless on Tuesday.
The S&P 500 rose less than 0.1% to 4,291.80, adding to its all-time high set a day earlier. More stocks fell than they rose in the index, but gains by tech companies offset weakness in banks and utilities.
The Dow Jones Industrial Average also rose less than 0.1% to 34,292.29. The Nasdaq composite added 0.2% to 14,528.33.
The stocks set their recent highs on optimism that the economy is strengthening and that the Federal Reserve will keep interest rates low for some time to come.
A report released on Tuesday showed that US consumer confidence continues to rise, beating economists’ expectations for a slight dip. This is the key to an economy made up primarily of consumer spending.
A separate report showed home prices across the country rose again in April, continuing their meteoric pace.
One day in June, the market is about to end a solid first half. The S&P 500 is on track for a 14.3% gain, more than double its full-year average, dating back to the turn of the millennium.
Big banks have announced plans to return billions of dollars to shareholders through dividend increases and share buybacks after passing the Federal Reserve’s most recent “stress tests”.
The central bank has stuck to its position that high inflation is likely only temporary. This would allow it to keep interest rates low longer than it would otherwise.
Long-term bond yields have stabilized after surging earlier in the year, in part on inflationary fears. The 10-year Treasury yield remained stable at 1.48%.
In other exchanges, the US benchmark crude oil gained 30 cents to $ 73.28 per barrel in electronic trading on the New York Mercantile Exchange. It gained 7 cents to $ 72.98 a barrel on Tuesday. Brent crude, the international standard, rose 15 cents to $ 74.43 a barrel.
The US dollar was trading at 110.47 Japanese yen, against 110.52 yen. The euro went from $ 1.1898 to $ 1.1900.
Copyright 2021 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.