Asian Markets Mostly Fell As Investors Assess Key Economic Data

In today’s trading, Asian shares mostly declined after China maintained a key lending rate and reported a slowdown in factory output for May, with the property market remaining in a slump. 

In addition, the Bank of Japan kept rates unchanged as anticipated, but disappointed markets by postponing a reduction in its monthly bond purchases. 

On Friday, the Bank of Japan stated announced plans to reduce its substantial holdings of government bonds, marking a cautious shift away from its prolonged ultra-loose monetary policy. 

Following a two-day meeting, the central bank kept interest rates unchanged but revealed intentions to “reduce its purchase amount of JGBs (Japanese Government Bonds) thereafter to ensure that long-term interest rates would be formed more freely.”

The BoJ stated that a detailed plan for the reduction during the next one to two years or so will be decided at the next policy meeting in July. 

Meanwhile, Hong Kong’s Hang Seng index remained unchanged at 17,936.12, while the Shanghai Composite index decreased by 0.6% to 3,015.89.

China’s factory output declined by 5.6% in May, as reported by the government, falling short of analysts’ expectations and down from 6.7% in April. Retail sales increased by only 4.1% in the first five months of the year. 

Adding to the disappointing figures, property investments dropped by 10% in May compared to last year, with home prices in major cities declining by 3.2%

Property sales plummeted by 30.5% year-on-year, further indicating that numerous measures aimed at reversing the property sector slump have yet to take effect. 

Most markets in Asia were closed for holidays, Tokyo’s Nikkei 225 index dropped by 1.8% to 38,102.44, while South Korea’s Kospi fell 0.5% to 2,744.10. 

In Australia, the S&P/ASX200 slipped 0.3% to 7,700.30.