By Dow Jones Newswires
Asian stock markets gained Wednesday as Japan held the line on interest rates, and even China marked an advance despite weaker-than-expected manufacturing data.
Japan’s Nikkei /zigman2/quotes/210597971/delayed JP:NIK +1.70% was up 2.1% following robust earnings reports after Tuesday’s closing bell. Overnight gains in U.S. equities also helped the risk-on mood.
Investors in Japanese equities are embracing risk amid the ongoing earnings season, with Mazda /zigman2/quotes/204777714/delayed JP:7261 +10.59% up 2% ahead of its earnings report Wednesday. Sony /zigman2/quotes/201361720/delayed JP:6758 +4.47% was up 4.7% after it reported that its net profit beat forecasts by ¥173 billion after the closing bell Tuesday. Honda’s /zigman2/quotes/200490352/delayed JP:7267 +6.06% second-quarter profit also rose sharply, helping boost its shares by 6.5%.
Meanwhile, yields in long-term debt were higher across the board ahead of the Bank of Japan’s monetary policy announcement. Later in the day, the panel stood pat on interest rates as was widely expected. The BoJ plans to keep rates ultra low for the foreseeable future as concerns grow about the impact of U.S.-China trade tensions on the Japanese economy.
The benchmark 10-year JGB yield was up half a basis point at 0.120% during Asian trading hours. The U.S. dollar /zigman2/quotes/210598269/delayed DXY -0.02% retreated against a basket of major currencies during Asian trading, adding to regional export weakness concerns.
Chinese equity benchmarks were higher, amid lack of negative surprises from the latest economic data. The official manufacturing PMI was 50.2 in October compared to consensus 50.6 and 50.8 in the prior month, marking the lowest reading since July 2016. Non-manufacturing PMI showed similar weakness, at 53.1 versus 54.1 in September, its lowest in 14 months. Despite that, Chinese stocks rose, with the Shanghai Composite /zigman2/quotes/210598127/delayed CN:SHCOMP +0.11% up about 1.3% and the smaller-cap Shenzhen Composite /zigman2/quotes/210598015/delayed CN:399106 -0.65% up 1.3%.
Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +2.26% also rose about 1.6%, with Sunny Optical /zigman2/quotes/206687505/delayed HK:2382 -0.61% up 5% and AAC /zigman2/quotes/201441510/delayed HK:2018 -0.40% rising 4.7%. Chinese energy stocks did well, too, with gains for China Shenhua /zigman2/quotes/206065610/delayed HK:1088 +0.77% and PetroChina /zigman2/quotes/204979431/delayed HK:857 +1.90% . Among other major stocks, Tencent /zigman2/quotes/204605823/delayed HK:700 +2.41% rebounded over 5%, AIA /zigman2/quotes/203565558/delayed HK:1299 +3.53% added 1.8% and Xiaomi /zigman2/quotes/208140246/delayed HK:1810 +3.46% rose 4%.
New Zealand’s S&P/NZX 50 /zigman2/quotes/211587880/delayed NZ:NZ50GR +0.91% was 1.2% higher while Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 +1.29% rose 0.7% as Samsung /zigman2/quotes/209800866/delayed KR:005930 +0.88% rebounded slightly from an earlier loss, after posting record quarterly profit but disappointing phone sales.