Asian shares mostly lower on strong China price data
Shares declined in Hong Kong, Shanghai, Sydney and Seoul.On Thursday, stocks closed moderately higher on Wall Street, lifted by gains in large technology companies that benefit from lower bond yields.PTI | Bangkok | Updated: 09-04-2021 10:55 IST | Created: 09-04-2021 10:55 IST
Shares fell Friday in most Asian markets after China reported a stronger than expected rise in prices that could prompt authorities to act to cool inflation. Japan's benchmark Nikkei 225 index rebounded after falling the day before. Shares declined in Hong Kong, Shanghai, Sydney and Seoul.
On Thursday, stocks closed moderately higher on Wall Street, lifted by gains in large technology companies that benefit from lower bond yields. But an increase in jobless claims dented some of the buying enthusiasm. China reported that consumer prices rose in March due to a jump in fuel prices, while producer prices climbed at the fastest pace in more than four years. The consumer price index rose 0.4 per cent in March compared with minus 0.2 per cent in February, as fuel prices jumped nearly 12 per cent from a year earlier. Prices paid by manufacturers rose 4.4 per cent from a year earlier. Inflation reflects rising demand as China's economy leads the world recovery from the pandemic. Worries that stronger growth might spur inflation that regulators in many major economies would then move to cool, partly by raising interest rates, have been overhanging the markets for the past several months. Added to that, a fresh round of US sanctions, this time against seven Chinese supercomputer makers, has revived concern over trade friction between the two largest economies, said Jeffrey Halley of Oanda.
“Asian markets are once again adopting a more cautious posture today. Geopolitics is never far from the surface, even if it is often lost in the global recovery noise,'' Halley said in a report. The Shanghai Composite index lost 0.7 per cent to 3,456.74 and the Hang Seng in Hong Kong also fell 0.7 per cent to 28,798.07. Australia's S&P/ASX 200 gave up 0.2 per cent to 6,985.20 and the Kospi in Seoul declined 0.1 per cent to 3,137.84. Japan's Nikkei 225 rose 0.4 per cent to 29,814.51. Shares in Sony Corp. rose 2.7 per cent after the company signed an exclusive movie distribution deal with Netflix. On Thursday, the S&P 500 index gained 0.4 per cent to 4,097.17, another record high following records set on Monday and Wednesday. The Dow Jones Industrial Average gained 0.2 per cent, to 33,503.57. The tech-heavy Nasdaq composite climbed 1 per cent to 13,829.31.
Small company stocks, which have been outpacing the broader market this year, also had a good showing. The Russell 2000 index of smaller companies picked up 0.9 per cent, to 2,242.60. The index is up 13.6 per cent so far this year, while the S&P 500, which tracks large companies, is up 9.1 per cent.
Stocks have benefited this week as bond yields, which had been steadily ticking higher, retreated from highs hit earlier in the month. The yield on the 10-year U.S. Treasury note, which influences interest rates on mortgages and other loans, fell to 1.63 per cent from 1.65 per cent late Wednesday. It had been as high as 1.75 per cent on Monday. That pullback in yields took some pressure off technology stocks, which have slipped over the last few months as yields jumped, making those shares look pricey. The sector has also seen choppy trading as investors shift more money into companies that stand to benefit from the economic recovery.
(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)