By Sarah Turner, MarketWatch
SYDNEY (MarketWatch) — Asia stocks traded mostly higher Monday as investors reacted to U.S. and Chinese data, with Tokyo managing outperform the rest of the region on further weakness for the Japanese yen.
Japan’s Nikkei Stock Average /zigman2/quotes/210597971/delayed JP:NIK -0.65% ended 0.5% higher, with Tokyo’s broader Topix benchmark rallying 1.9%. Meanwhile, Taiwan’s Taiex , and Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +2.40% each climbed 0.3% in late trading, while Australia’s S&P/ASX 200 index /zigman2/quotes/210598100/delayed AU:XJO +1.12% closed with a 0.5% gain.
On the downside, the Shanghai Composite Index /zigman2/quotes/206600939/delayed CN:000001 +2.40% dipped 0.3% in late-session moves, while South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 +1.73% .edged down 0.2% ahead of the close.
“Sentiment appears to be finely balanced between weak Chinese industrial output and retail sales data and the stronger-than-expected U.S. employment landscape,” said CMC Markets trader Niall King.
After the close of Asian trade Friday, monthly U.S. employment data that showed that the economy created 236,000 jobs in February as the employment rate fell to a 2008 low, helping to lift stocks on Wall Street. Read: Stocks up for week; S&P 500 near record
“There were more jobs, more hours and more pay, which combined with rising wealth effects, gives the consumer sector much more momentum to deal with higher taxes, the sequester and higher oil prices,” said Perpetual Investments head of investment research Matthew Sherwood.
The U.S. dollar /zigman2/quotes/210561789/realtime/sampled USDJPY -0.6412% rose after the data, with particularly sharp gains against the Japanese yen. The greenback held on to most of that strength through Monday — trading at ¥96.10 by Monday afternoon in East Asia, little changed from ¥96.08 late Friday in North America. Read: Dollar rallies as February payrolls leap
Exporters tend to benefit from a weaker yen, and those firms added to their recent gains Monday in Tokyo, with auto companies especially strong, as Mitsubishi Motors Corp. /zigman2/quotes/202404490/delayed JP:7211 +0.20% /zigman2/quotes/200876874/delayed MMTOF +5.19% rose 5.9%, Subaru maker Fuji Heavy industries Ltd. /zigman2/quotes/203522406/delayed JP:7270 +2.20% /zigman2/quotes/200526066/delayed FUJHY +5.10% climbed 1.7%, Honda Motor Co. /zigman2/quotes/200490352/delayed JP:7267 +1.12% /zigman2/quotes/207173990/composite HMC +7.20% added 2.6% and Nissan Motor Co. /zigman2/quotes/208298710/delayed JP:7201 +1.61% /zigman2/quotes/207656007/delayed NSANY +5.62% advanced 3.2%.
“After what proved to be only a brief pause, the slide in the yen and associated surge in the Nikkei [Average] have both resumed with a vengeance. A yen/dollar exchange rate of ¥100 and a further rally to 13,000 on the Nikkei are certainly plausible targets for the near term,” said Capital Economics economist Mark Williams.
Lifted by inflation optimism, financial-sector firms have also strengthened notably since late last year, and the sector jumped again on Monday. Resona Holdings Inc. /zigman2/quotes/203178794/delayed JP:8308 +0.89% /zigman2/quotes/201424788/delayed RSNHF +3.50% surged 13.7%, Shinsei Bank Ltd. /zigman2/quotes/210166295/delayed JP:8303 -0.05% climbed 8.4%, and Daiwa Securities Group Inc. /zigman2/quotes/201391978/delayed JP:8601 -0.27% /zigman2/quotes/201035229/delayed DSEEY +5.47% traded 6.2% higher.
Sumitomo Mitsui Trust Holdings Inc. /zigman2/quotes/207195052/delayed JP:8309 +0.42% /zigman2/quotes/206166011/delayed SUTNY +1.88% moved up 2.3% after announcing late Friday that it will pay off the balance of the public funds it obtained in the late 1990s when the Japanese government bailed out domestic financial institutions to head off a crisis, according to a Nikkei news report.
Still, Sharp Corp. /zigman2/quotes/203224600/delayed JP:6753 0.00% /zigman2/quotes/207472799/delayed SHCAF -6.25% fell 3.1% after the Asahi Shimbun reported Taiwan’s Hon Hai Precision Industry Co. /zigman2/quotes/207256514/delayed TW:2317 +2.73% /zigman2/quotes/205520950/delayed HNHPF +2.56% /zigman2/quotes/205520950/delayed HNHPF +2.56% would miss a self-imposed deadline to invest in the debt-heavy Japanese tech firm, though it may make an investment later on. Shares of Hon Hai traded flat in Taipei.
Over in Hong Kong, investors were buying into globally exposed firms after the jobs data from the U.S, with logistics company Li & Fung Ltd. , up 1.5%, while fashion house Prada SpA /zigman2/quotes/200575701/delayed HK:1913 +3.80% /zigman2/quotes/204689658/delayed PRDSY -0.09% rose 2.3%.
The gains in Hong Kong contrasted with weakness in Shanghai. Chinese data out over the weekend showed consumer inflation accelerating significantly in February, even as industrial output and retail sales eased. Read: China inflation climbs; other indicators soften
“The weekend China data showed firmer-than-expected [consumer] inflation, firmer-than-expected industrial production and retail sales, and weaker than expected fixed-asset investment — not the mix of activity and inflation officials would have liked,” said RBC Capital Markets strategist Sue Trinh.
“Some caution in interpreting the data is needed, given distortions caused by the Lunar New Year holiday, but it may take another month or two of data to get a clearer picture,” she said.
Bank stocks declined on the Chinese mainland, with China Merchants Bank Co. /zigman2/quotes/210188047/delayed CN:600036 +3.65% /zigman2/quotes/208876947/delayed CIHKY -0.85% down 1.4%, and Agricultural Bank of China Ltd. /zigman2/quotes/204629388/delayed CN:601288 +0.35% /zigman2/quotes/207749118/delayed ACGBY 0.00% lower by 1.1%, while Bank of Communications Co. /zigman2/quotes/207155262/delayed CN:601328 +0.66% /zigman2/quotes/202128064/delayed BCMXY +2.28% fell 0.8%.
South Korean exporters were once again suffering along with the weaker yen, as Korean and Japanese firms compete head-to-head in many overseas markets.
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Autos have been particularly hard-hit since the start of the year, and they were lower again on Monday, with Kia Motors Corp. /zigman2/quotes/206019389/delayed KR:000270 +0.12% /zigman2/quotes/205439169/delayed KIMTF +8.21% down 1.9% and Hyundai Motor Co. /zigman2/quotes/206684590/delayed KR:005380 +0.26% /zigman2/quotes/204364212/delayed HYMTF -0.57% lower by 2.6%.
After the Chinese data, Australian miners fell Monday on concerns about the economic health of their biggest customer, with Rio Tinto Ltd. /zigman2/quotes/200083756/delayed AU:RIO -0.07% /zigman2/quotes/202627887/composite RIO +0.63% down 2%, and BHP Billiton Ltd. /zigman2/quotes/201448516/delayed AU:BHP +2.22% /zigman2/quotes/208108397/composite BHP +1.91% lower by 0.8%.
Helping to offset the mining-sector losses were energy giant Woodside Petroleum Ltd. /zigman2/quotes/206770672/delayed WOPEF +1.10% , up 0.7%, and telecom heavyweight Telstra Corp. Ltd. /zigman2/quotes/201936124/delayed AU:TLS -1.25% /zigman2/quotes/202275272/delayed TTRAF +0.08% , which advanced 1.1%.