Asian stocks make modest gains after steady Chinese GDP data

Marco Green
April 17, 2018

China's economy grew a welcome 6.8 percent in the first quarter of 2018 from a year earlier, official data showed on Tuesday, unchanged from the previous quarter. The Nasdaq added 0.7 percent to 7,156.28. "Underneath the stable GDP growth is quite rapid rebalancing from industrial, investment and old economy sectors to consumption, services and new economy sectors like tech".

MSCI's broadest index of Asia-Pacific shares outside Japan edged down 0.15 percent. Singapore fell 0.4 percent and Seoul was off 0.1 percent, while Wellington and Taipei also fell.

The benchmark Shanghai Composite index tumbled 48.40 points or 1.5% to post its worst loss in three weeks while Hong Kong's Hang Seng index closed down 1.6% at 30,315.59 points.

Meanwhile, Japanese shares finished modestly higher after Russian Federation did not respond to the US -led missile strike on Syria.

However, while President Putin warned on the potential impact on world affairs if there were further Western strikes on Syria, U.S. ambassador to the United Nations, Nikki Haley, said the United States would announce new economic sanctions on Monday aimed at companies "dealing with equipment" related to Syria's alleged chemical weapons use.

"Investors were relieved that the military action didn't expand further", said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management Co., as the strikes were limited to Syrian chemical weapons facilities and did not escalate into a direct confrontation with Russian Federation.

Asian stocks ended mixed on Monday as worries about slowing growth in China and higher interest rates offset easing concerns about the geopolitical risks of the conflict in Syria. But the impact on financial markets in Asia was limited as it comes at a time of even harsher threats of USA penalty tariffs on China and other nations.

Looking ahead, the US earnings season kicks into high gear this week with Thomson Reuters data predicting profits at S&P 500 companies increased by 18.6 percent in the first quarter from a year ago, their biggest rise in seven years.

S&P 500 companies are expected to report an 18.6% jump in first-quarter profit, on average, the biggest rise in seven years, according to Thomson Reuters data.

CURRENCY: The dollar was trading at 107.23 yen, down from 107.36 yen late Friday.

The euro was steady at $1.2330 EUR= , while the dollar index eased a touch to 89.772 .DXY . The pound rose to $1.4355, its highest since June 2016, with focus on data that could cement expectations of a May interest rate increase from the Bank of England (BoE).

The yield on both German and US 10-year government bonds, seen as among the most liquid and safe assets in the world, were at their highest levels in three weeks.

Brent crude climbed 0.3% to $71.61 a barrel.

Aluminum hovered near seven-year highs reached the previous day after US sanctions on Russian producer Rusal stirred supply concerns.

United States crude oil futures rose 0.4% to $66.49 a barrel after tumbling almost 1.8% overnight as the concern over tension in the Middle East waned.

Aluminum on the London Metal Exchange was at $2,386 per tonne after surging 5 percent to $2,403 on Monday, its highest since September 2011.

Other reports by Click Lancashire

Discuss This Article