ASIA MARKETS: Mixed Bag For Asian Stocks As Nikkei Gets Back On Track

By Lucy Craymer Features Dow Jones Newswires

Markets in China, Hong Kong slip after disappointing data

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Stock markets across Asia-Pacific lacked direction early Tuesday, with gains for regional energy and mining firms thanks to a jump in commodity prices, while Chinese markets again succumbed to selling pressure.

After two sessions in the red, Japan's headline stock index rose and closed in on the key 20,000-point level, helped by gains in energy stocks. If the index breaks through this level it would be the first time it has done so since the end of 2015. The Nikkei Stock Average was last up 0.3% at 19,918.94.

Elsewhere, a boost from commodity-exposed stocks lifted Australia's S&P/ASX 200 by 0.2%, while the FTSE Bursa Malaysia KLCI gained 0.1%.

"At the moment we are taking inspiration from the higher oil price and what it means for energy prices across the world; what it means for (capital expenditure); and what it means for reflation -- and of course the market loves reflation," said Chris Weston, chief market strategist at IG Markets in Australia.

Meanwhile, Chinese markets were markedly lower, after data on Monday disappointed with retail sales and industrial production seeing slower growth in April, while fixed asset investment in the first four months of the year failed to meet expectations, rising just 8.9% compared with the same period the year before.

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The Shanghai Composite Index was last down 0.7%, while the Shenzhen Composite Index was off 0.5%. In Hong Kong, the Hang Seng Index was off 0.3%.

Oil prices ended Monday around 1.9% higher after the world's two biggest crude-oil producers, Russia and Saudi Arabia, said they agreed that petroleum-output cuts should be extended into March 2018. This was seen by the market as the strongest signal yet that the Organization of the Petroleum Exporting Countries and other producers will continue to influence oil prices, say analysts.

Brent-crude , the global benchmark, was trading up 0.4% at $52.04 a barrel in early Asian trading Tuesday, while West Texas Intermediate gained 0.5% to $49.08 a barrel.

Despite the indications that a production cap will roll over, there were nonetheless expectations of increased demand in the second half of the year, and as such investors should remain cautious, said Stuart Ive, private client manager at OM Financial in New Zealand.

"OPEC meets on the May 25 so the market will want official confirmation of the deal rollover," said Ive.

Still, the oil-price jump continued to support mining and energy stocks in Asia. In Hong Kong, oil giant PetroChina (0857.HK) was up 0.6%, while offshore oil producer Cnooc (0883.HK) added 0.7%. In Australia, BHP Billiton (BHP.AU) was up 0.8%, Oil Search Ltd. (OSH.AU) gained 1.6% and Fortescue Metals Group (FMG.AU) rose 2.7%.

In precious metals, gold prices were at their highest level in two weeks, as some investors looked to safe-haven assets following the recent show of nuclear strength by North Korea. Meanwhile, South Korea's Kospi Index was last down 0.2%.

(END) Dow Jones Newswires

May 15, 2017 23:13 ET (03:13 GMT)