Asia holds breath for China data dump, NZ$ slides

Pedestrians walk past electronic board showing the Nikkei stock index outside a brokerage in Tokyo January 7, 2019. — Reuters pic
Pedestrians walk past electronic board showing the Nikkei stock index outside a brokerage in Tokyo 7, 2019. — Reuters pic

SYDNEY, April 17 — Asian share markets got off to a guarded start today as investors waited anxiously for a raft of data that might show policy stimulus is finally gaining traction in the world’s second-largest economy.

The main mover of the morning was the New Zealand dollar which dived after a weak reading on consumer price inflation stoked expectations for a cut in interest rates.

Investors are hoping for better news from which is forecast to report first-quarter economic growth of 6.3 per cent. While that would be the slowest pace in at least 27 years, the economy is many times larger now.

A flurry of stimulus measures looks to have put a floor under activity in March, with annual growth in retail sales seen picking up to 8.4 per cent. Industrial output is forecast to rise 5.9 per cent and urban investment 6.3 per cent.

MSCI’s broadest index of Asia- shares outside Japan was a fraction lower, having boasted its highest close yesterday since June last year.

Japan’s Nikkei inched up 0.2 per cent to reach its highest in almost five months. E-Mini futures for the S&P 500 were off 0.06 per cent.

Over on , the Dow ended yesterday with a slight gain of 0.26 per cent, while the S&P 500 firmed 0.05 per cent and the Nasdaq 0.3 per cent.

Healthcare shares fell after UnitedHealth Group Inc discussed concerns about US Senator Bernie Sanders’ “Medicare for All” plan, as well as the White House’s proposal to end discounts from drugmakers.

Shares of Qualcomm jumped 23 per cent to US$70.45 (RM289.64), their biggest gain in more than 19 years, after winning a surprise settlement of a long-running legal dispute with Inc.

Still, action across markets has become steadily more muted after a strong start to the year. The CBOE Volatility Index has hit its lowest level in more than six months, while European stock volatility reached its lowest level since January 2018.

Currency markets have been similarly becalmed. While the has edged up against a basket of currencies to 97.074 , it has traded between 95.00 and 97.70 for six months now.

The US dollar did finally manage to top resistance on the yen at 112.13 to reach its highest since December at 112.16.

The euro was flat at US$1.1285, having slipped form US$1.1314 overnight on a Reuters report that several European Central Bank policymakers think the bank’s economic projections are too optimistic.

One currency on the move was the New Zealand dollar which sank 0.8 per cent to US$0.6708 after annual consumer price inflation came in well below expectations at just 1.5 per cent for the first quarter.

Yields on two-year bonds dived 9 basis points to 1.48 per cent as investors wagered the Reserve Bank of New Zealand (RBNZ) would have to cut rates in response.

In commodity markets, the general improvement in risk sentiment saw spot slip to its lowest for the year so far and was last at US$1,276.61 per ounce.

Oil prices were buoyed as fighting in Libya and falling Venezuelan and Iranian exports raised concerns over tightening global supply.

US crude was last up 31 cents at US$64.36 a barrel, while crude futures were up 14 cents at US$71.86. — Reuters

Source: The Malay Mail Online

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