Asian Markets Gain Despite Wall Street Decline and Weak Chinese Factory Data
In today’s trading session, most Asian stocks witnessed gains despite another drop on Wall Street and an official survey indicating a slowdown in Chinese factory activity.
Tokyo’s Nikkei 225 saw a modest gain of 0.2%, reaching 38,119.96, as reports circulated about plans for major investments by government-based pension funds and other large institutional investors. Semiconductor maker Tokyo Electron dropped by 2.5%.
According to the Nikkei financial news outlet, Japan plans to inject nearly 100 trillion yen ($683 billion) of public funds into the markets, following the example set by the Government Pension Investment Fund.
South Korea’s Kospi increased by 0.4% to 2,646.44. Despite the survey revealing further strain on an economy already struggling with a prolonged crisis in the property industry, Chinese shares also increased.
Negative indicators often spark speculation that Beijing will implement growth-friendly policies. Hong Kong’s Hang Seng index jumped 1.2% to 18,446.05, and the Shanghai Composite index rose by 0.3% to 3,099.72.
There was little reaction to data indicating that China’s factory activity contracted in May for the first time in three months, dampening fragile optimism about the economic recovery.
However, co-founder of Mobius Capital Partners, Mark Mobius mentioned he had become optimistic about Chinese equities in recent weeks after authorities introduced various measures to support the country’s struggling property market.
In forex markets, the yen strengthened against the dollar following inflation figures from Tokyo, considered a barometer for Japan, fueling speculation about another rate hike.
Charu Chanana from Saxo stated that the BoJ has been indicating further tightening, and this inflation data allows the central bank to continue normalizing policy and supporting the yen.
In Australia, the S&P/ASX 200 climbed 1% to 7,701.70.
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