Nikkei rises despite yen's strength; China stocks down after contradictory PMI data
Global equity markets struggled to find direction as a new month began, though Japan outperformed despite a lack of action with the yen, which often affects the country's stocks.
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After four straight sessions of modest declines, the Nikkei Stock Average was recently up 0.9%, even as the dollar remained near Yen111.
Government data out Thursday morning showed continued growth in Japanese capital spending in the first quarter. "Domestic corporate activities are becoming more active," said Daiwa Securities senior strategist Hideyuki Ishiguro.
But he said the jump for the Nikkei, which rose more than 1% earlier Thursday, "surprising" given that the yen was only slightly softer in Asian trading. Export-reliant stocks were strong, with auto and electronics companies experiencing 2% gains.
Perhaps the calendar is to blame.
The Nikkei hasn't finished its first trading session of a month higher since June of last year. Some trading programs may have taken that trend into consideration, Ishiguro said. And Shingo Ide, chief equity strategist at NLI Research Institute, said a new month often means a clean slate for institutional investors, which helps to trigger bold moves.
China equities underperformed, however. After having opened lower, shares there extended declines after an unofficial manufacturing PMI reading slipped into contractionary territory for the first time since last June. That diverged from the official reading released Wednesday, which came in above consensus at 51.2.
The Shanghai Composite Index was recently trading down 0.5%, while the Shenzhen Composite Index fell 1%
South Korean equities eased slightly despite data showing that exports expanded for a seventh straight month in May. The Kospi , which has been at record highs lately, fell 0.1%.
Meanwhile, Taiwan's Taiex rebounded 0.3% after Wednesday's post-holiday pullback, while Hong Kong's Hang Seng Index rose 0.4%, on track to close at a fresh 23-month high.
Oil has rebounded nearly 1% in Asian trading (http://www.marketwatch.com/story/oil-rebounds-after-api-report-but-analysts-have-little-faith-in-gains-2017-06-01) thanks to an upbeat reading on U.S. crude inventories.
(END) Dow Jones Newswires
June 01, 2017 01:55 ET (05:55 GMT)