Asia Markets Mixed Following China’s Trade Data; Nikkei Drops Amid Suspected Yen Intervention
Asian stocks were mixed, with the yen fluctuating between gains and losses following the latest inflation update.
In today’s trading, Asian stocks were mixed, with the yen fluctuating between gains and losses following the latest inflation update. This strengthened Wall Street’s expectations for potential interest rate relief by September.
The USD/JPY currency dropped 2.1% overnight, trading as low as 157.43, sparking speculation that Japanese authorities may have intervened to enhance the impact of the dovish US inflation data.
The Nikkei 225 index plummeted by 2.5% closing at 41,190.68 after the Bank of Japan conducted rate checks with banks on the euro-yen cross on Friday, raising concerns about possible intervention by Japanese authorities, though top currency diplomat Masato Kanda declined to confirm this.
Japan’s industrial production growth for May 2024 was revised upward to 3.6% month-over-month, compared to the preliminary estimate of a 2.8% increase. Investors are also anticipating the Bank of Japan’s policy meeting in late July, where it is expected to announce plans for tapering bond purchases and potentially raise interest rates again.
Mainland China stocks also struggled to sustain the previous session’s rally, which was fueled by new regulatory measures aimed at curbing aggressive stock market selling, following mixed trade data on Friday. China reported its largest trade surplus in nearly two years, with exports surging and imports weakening.
Traders are now looking ahead to next week’s GDP release and a key political meeting in Beijing.
Hong Kong’s Hang Seng index rose 2.6% to 18,293.38, while the Shanghai Composite index remained nearly unchanged at 2,971.29, following data indicating that China’s exports increased by 8.6% in June, surpassing market expectations.
Meanwhile, Bangkok’s SET edged up by 0.1%. Taiwan’s Taiex dropped 2% with Taiwan Semiconductor falling 3.7%. Despite initially rising on the announcement that its revenue had climbed nearly 33% in June compared to the same period last year, the company followed Wall Street tech giants lower.
In Australia, the S&P/ASX 200 gained 0.9% to reach 7,959.30, while South Korea’s Kospi fell 1.2% to 2,857.00.
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