Asian shares mixed af­ter con­sen­sus-beat­ing Ja­pan GDP data


Asian shares were mixed on Mon­day, with Tokyo helped by bet­ter-than-ex­pected Ja­panese growth fig­ures while Shang­hai fell de­spite a gov­ern­ment pledge to sup­port China s volatile stock mar­kets. The dol­lar strength­ened af­ter solid US data boosted ex­pec­ta­tions of an im­mi­nent US rate rise, heap­ing pres­sure on oil prices af­ter they slid to a six-and-a-half-year low last week. Syd­ney rose 0.31 per­cent, while Seoul dropped 0.46 per­cent and Hong Kong dipped 1.03 per­cent in morn­ing deals.

Shang­hai stocks lost 0.65 per­cent, fol­low­ing their big­gest weekly gain in two months, even af­ter Bei­jing pledged to sup­port the coun­try s volatile mar­kets for the new few years.

Mean­while, Tokyo shares rose 0.35 per­cent af­ter news Ja­pan s econ­omy shrank a lower-than-ex­pected 0.4 per­cent in the April-June quar­ter and 1.6 per­cent from a year ago.

The weak read­ing beat mar­ket ex­pec­ta­tions for a quar­terly fall of 0.5 per­cent, or a 1.8 per­cent an­nu­alised drop, and spurred hopes the gov­ern­ment will in­ter­vene to help prop up the stum­bling econ­omy. "The GDP data isn t bad," An­drew Clarke, di­rec­tor of trad­ing at bro­ker­age Mirabaud Asia, told Bloomberg News. "It s a small step in the right di­rec­tion."

Chi­nese shares fell, de­spite the gov­ern­ment on Fri­day vow­ing to sup­port eq­ui­ties for a "num­ber of years" in a bid to end ex­treme volatil­ity in the stock mar­ket. The move, which an­a­lysts said was de­signed to soothe in­vestors fraz­zled nerves, came af­ter the cen­tral bank s shock de­val­u­a­tion of the yuan on Tues­day sent global fi­nan­cial mar­kets into tur­moil.

The sud­den cut in the Chi­nese cur­rency in­flamed fears Asia s top econ­omy is grow­ing slower than pre­vi­ously thought, hurt­ing com­mod­ity prices and spark­ing the worst two-day sell­off in Asia-Pa­cific cur­ren­cies since 1998.

But Shang­hai eq­ui­ties added al­most six per­cent over the week on ex­pec­ta­tions the cut would boost China s flag­ging econ­omy and hopes it au­gured more sup- port mea­sures from Bei­jing.

On Mon­day China lifted the daily ref­er­ence rate for the yuan against the dol­lar by 0.01 per­cent. "The sit­u­a­tion sur­round­ing the yuan has passed its peak and there s a sense of calm," Hirot­sugu Na­gata, from the in­vest­ment in­for­ma­tion depart­ment at Mizuho Se­cu­ri­ties, told Bloomberg News. "The mar­ket s at­ten­tion now re­turns to the US rate in­crease."

Wall Street fin­ished higher Fri­day af­ter solid in­dus­trial pro­duc­tion, whole­sale prices and July re­tail sales data all sig­nalled the world s top econ­omy is strength­en­ing.

The num­bers all added to ex­pec­ta­tions the US Fed­eral Re­serve could be set to raise its key in­ter­est rate as early as next month, driv­ing up the dol­lar in Asia on Mon­day. The green­back was quoted at 124.39 yen, up mod­estly from 124.32 yen in New York late Fri­day.

The euro slid to $1.1096 and 138.01 yen from $1.1112 and 138.14 yen. But the stronger US cur­rency added to pres­sure on oil prices, which con­tin­ued their slide af­ter notch­ing their sev­enth straight week of falls on ex­pec­ta­tions of a grow­ing sup­ply glut. A stronger green­back makes dol­lar-de­nom­i­nated oil more ex­pen­sive for over­seas in­vestors and so tends to hurt de­mand.

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