The Shanghai Composite Index advanced for a second day as sentiment improved with President Xi Jinping’s positive comments about the Chinese economy ahead of his U.S. visit. Markets in Japan remain closed for a three-day holiday. Economists had forecast the inflation to ease to 3.0 percent. Nonetheless, the problems China faces in reaching its 7% GDP growth target as we approach the final stretch of the year are becoming increasingly stark.
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Korea’s benchmark Kospi index is up 0.32 percent at 1,970 points.
Australia market tumbles 2.1%. Investors are also awaiting the euro zone’s flash manufacturing activity reading on Wednesday, which is expected to come in slightly stable to soft in September.
Oil prices fell in early trade after rising over 4% overnight on declining stockpiles and drilling activity. CKH Holdings lost 1.65 percent to 101.5 HK dollars.
On the economic front, a leading economic index for Australia finally turned higher in July after four straight months of decline, the Conference Board said, with the corresponding index increasing 0.3 percent following a revised 0.3 percent decline in June. China will expand a yuan-denominated investment limit for the United Kingdom based on market demand according to the statement.
Asian stocks rose modestly Tuesday as investor anxiety over a timing of a Fed interest rate rise was replaced by cautious optimism over upcoming China factory data. The Shanghai Composite index pared sharp early losses to close down 0.2%, while the smaller Shenzhen index lost 2%. Sydney – where a number of firms with strong China links are listed – ended down 2.07 percent.
The market crash, coupled with renewed fears about slowing growth in China, rattled global markets and led to a punishing August for investors. State intervention has helped stem losses: although the share gauge is poised for a 2.8 percent drop in September, that would be its best month since May.
This morning, the Hong Kong market is confused again.
China prompted another drop in Asian and emerging market stocks after a private manufacturing gauge fell to the lowest since March 1999.
In Hong Kong, property developers pounded the benchmark index. CNOOC (00883) slid 4.6% to HK$8.05. Nufarm shares soared 9.3 percent. Great Wall Motor (02333) dived 6% to HK$21.5.
The Japanese yen USDJPY, -0.03% slipped 0.1% to below ¥120 per US dollar.
Markets go into Friday with a new view of the Fed’s path to higher rates, and the promise of super-low rates for a little while longer. A result below 50 indicates shrinkage and anything above points to growth. The 50-share NSE Nifty bounced back 33.95 points, or 0.43%, at 7,845.95. S&P mini futures fell 1% after the weak China PMI.
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New Zealand’s currency weakened 0.5 per cent with South Africa’s rand.
