The Hang Seng Index and the broader Asian markets had a mixed day on Friday. The Hang Seng Index finished the week on a high note, while the ASX 200 and Nikkei were both down. Overnight US economic statistics from Thursday were positive, with Q2 GDP numbers that were higher than predicted confirming the soft-landing idea. …
The Hang Seng Index and the broader Asian markets had a mixed day on Friday. The Hang Seng Index finished the week on a high note, while the ASX 200 and Nikkei were both down.
Overnight US economic statistics from Thursday were positive, with Q2 GDP numbers that were higher than predicted confirming the soft-landing idea. The US economy expanded by 2.4% in the second quarter, compared to 2.0% in the first, supporting Fed staff estimates that the US would avoid a recession.
The ASX 200 was pulled down by Australian economic indices, while the Bank of Japan altered its Yield Curve Control Policy, sending Japan government bond yields higher.
Today’s session will be dominated by Japanese industrial production and retail sales figures. However, China’s NBS private sector PMIs will drive market risk sentiment. Beginning on Friday, the US Core PCE Price Index should provide early assistance.
In June, the US Core PCE Price Index grew by 4.1% year on year, compared to 4.6% in May. Economists predict a 4.2% increase. The soft-landing theory was bolstered by a reduction in bets on a September Fed rate hike.
The US financial markets reacted well to US economic figures, with the NASDAQ Composite Index rising 1.90%. The Dow and S&P 500 gained 0.50% and 0.99%, respectively, on Friday.
ASX 200
On Friday, the ASX 200 lost 0.70%. Bank and mining stocks fell as investors reacted to higher-than-expected producer price index statistics and lower-than-expected retail sales figures.
Retail sales fell 0.8% in June, following a 0.8% increase in May. In the second quarter, the producer price index unexpectedly climbed by 0.5%. Economists predict a 0.7% drop, heightening concerns about a hawkish RBA policy decision.
The big four had a negative session on Friday. The Commonwealth Bank of Australia (CBA) was down 0.97%, while The National Australia Bank (NAB) and Westpac Banking Corp (WBC) were down 0.32% and 0.31%, respectively. ANZ Group (ANZ) fell by 0.08%.
Mining stocks were also down, with Rio Tinto and BHP Group Ltd (BHP) down 1.00% and 0.82%, respectively. Fortescue Metals Group fell 5.41% on disappointing earnings, while Newcrest Mining (NCM) fell 1.82%.
Oil stocks had a volatile session. Woodside Energy Group (WDS) increased by 0.34% while Santos Ltd (STO) decreased by 0.13%.
Hang Seng Index
The Hang Seng Index gained 1.41% as a result of better-than-expected US GDP figures.
Tencent Holdings Ltd (HK:0700) and Alibaba Group Holding Ltd (HK:9988) recorded advances of 1.92% and 0.47%, respectively, among the key Index components.
Bank stocks, on the other hand, had a mixed session. HSBC Holdings PLC deviated from the trend, losing 0.23%. The Industrial and Commercial Bank of China (HK:1398) and China Construction Bank (HK:0939) gained 1.08% and 1.36%, respectively, on the day.
Nikkei 225
The Nikkei 225 lost 0.40% on Friday, weighed down by the Bank of Japan and a weaker USD/JPY. The Bank of Japan revised its Yield Curve Control Policy on Friday, declaring that 10-year government bond yields would be allowed to move with greater flexibility.
Tokyo’s inflation rate was higher than projected. The core annual inflation rate fell from 3.2% to 3.0%, compared to the expected 2.9%.
Banks had a positive session. Sumitomo Mitsui Financial Group (8316) and Mitsubishi UFJ Financial Group (5288) both increased their holdings by 4.30% and 5.28%, respectively.
When it comes to the primary components, Tokyo Electron Limited (8035) defied the trend by gaining by 2.50%. However, KDDI Corp (9433) and Sony Corp (6758) were down 1.00% and 1.29%, respectively, on the day. Fast Retailing Co (9983) and SoftBank Group Corp. (9984) both decreased by 0.11%.
Key notes:
The Hang Seng Index ended the week on a high note, experiencing a significant rebound of over 4% led by real estate stocks.
The ASX 200 saw a decline of 0.70% on Friday due to weaker-than-expected retail sales figures and hotter-than-expected producer price index numbers.
The Nikkei 225 fell by 0.40% on Friday, with the Bank of Japan’s tweak in its Yield Curve Control Policy and a weaker USD/JPY weighing on the index.
Risk disclaimer:
Please note that this article does not offer any instructions or suggestions regarding investment decisions. It is important for you to conduct your own research or seek professional advice from a qualified professional before conducting an investment decision.
