Investing.com– Most Asian stocks fell Tuesday following weaker-than-expected business activity figures in China, although the Nikkei reversed most of its early losses after the Bank of Japan took a tone less hawkish than the markets expected.
Chinese stocks fall as PMI data shows economic weakness
China contracted unexpectedly in October, while slowing significantly, according to Purchasing Managers’ Index (PMI) data.
The and indices fell 0.5% and 0.3% respectively, while the index lost 1% as data showed that Beijing’s recent stimulus measures had provided only a limited boost to Chinese companies.
Weakness in Chinese markets has spread across Asia, given the country’s role as a key trading hub for the region.
Concerns about China also more than offset a strong advance from Wall Street, which benefited from a resurgence in technology stocks. This week’s focus is also on key quarterly results from iPhone maker Apple Inc (NASDAQ:), which has several major suppliers in Asia.
South Korea’s index, heavily exposed to Chinese trade, fell 1.1% as positive earnings from index heavyweight Samsung Electronics (KS:) provided a limited boost.
Shares of the electronics giant fell 1% after it posted its best quarterly profit this year and said a boom in artificial intelligence would support chip demand through 2024. But its profit also fell by almost 80% compared to the same period last year.
and South Korea’s data showed signs of recovery.
The Australian index was trading almost flat, while the Indian index opened a slight rise.
Japanese stocks beat weak data as BOJ turns dovish
Japan’s interest rate rose 0.7%, while that of the country as a whole rose 0.6% after the Bank of Japan maintained its negative interest rates and made minimal changes to its policy. control of the yield curve.
Although the BoJ indicated it would allow more flexibility in its YCC operations, the move largely disappointed investors who were hoping for a more aggressive policy change. The BOJ also said it would continue its current pace of asset purchases.
This brought great relief to Japanese stocks, as it signals accommodative monetary conditions for the near future, unlike rising interest rates in most other major economies.
Local stocks beat data that showed both and rose less than expected in September.
Investors also largely ignored the BoJ’s warning that inflation would be higher than initially expected and that economic growth would be trending downward in coming years.
Still, larger gains were limited as investors hunkered down ahead of the conclusion of Wednesday’s meeting. Although the central bank is expected to keep rates unchanged, it is also expected to reiterate its policy of higher long-term rates, a trend that bodes poorly for Asian markets.