Asian markets conclude Friday’s trade on a mixed note

23 Aug 2013 Evaluate

The Asian markets concluded Friday’s trade on a mixed note with Japanese stocks led higher cheering gains on Wall Street and a weakened yen, while Chinese stocks retreated amid concerns about liquidity conditions. Seoul shares ended higher to snap a five-day losing streak. Hong Kong shares surrendered early gains and edged lower, dragged by afternoon weakness in Chinese markets as investors stayed cautious ahead of a slew of earnings reports from heavyweight Chinese financials next week. Today’s performance helped the Nikkei Average erase losses it had accumulated earlier in the week. But the Shanghai Composite, the Hang Seng Index and the KOSPI suffered weekly losses. Meanwhile, US investment bank Goldman Sachs expects the rout in Asian emerging market currencies to continue, downgrading its forecasts for battered currencies in the region. Goldman revised down its three, six and 12-month targets for the Malaysian ringgit, Thai Baht and Indonesian rupiah. The currencies, together with their emerging-market peers, have taken a beating recently amid expectations for an unwinding of US monetary stimulus.

Foreign direct investment to China surged to $9.41 billion in July registering 24.13% year on year increase, as the country continues to have robust growth in investment from abroad despite economic slowdown. At the same China’s Outbound Direct Investment (ODI) crossed $ 50 billion mark in the first six months registering a 20% increase. China attracted $9.41 billion in FDI in July which amounted to $71.39 billion in the first seven months up 7.09% from the same period last year, the Commerce Ministry stated. FDI in China’s manufacturing sector dropped 2.42%, taking a 41.18% share of the inflow, the ministry added. Japanese investors expect trading to remain cautious next week, ahead of the US Federal Reserve’s September meeting and Japan’s decision on whether to go ahead with its planned sales tax hike. Investors will also focus on a revision of Japan’s GDP, as a key factor before Prime Minister Shinzo Abe decides whether or not to approve plans to raise consumption tax in April next year. The Japanese government will announce revised figures for the three months to June on September 9 after its preliminary data showed its economy grew 0.6% from the previous quarter.

Indonesia announced a package of policy measures to reduce imports and boost investment in labor-intensive industries as it struggles to revive confidence and consumer spending in Southeast Asia’s largest economy. Indonesia has faced sell-offs in the rupiah, stocks and bonds after an unexpectedly large second-quarter current-account deficit triggered fears that the weak global economy will only further erode exports at a time when a surge in inflation is crimping domestic demand. The government also revised its GDP growth estimate for this year to 5.9-6.0%, down from 6.3% earlier. Indonesia’s rupiah headed for its worst week since 2008 and government bonds dropped after the country posted a record current-account deficit amid speculation the Federal Reserve will soon start tapering stimulus.

Asian Indices	Last Trade	Change in Points	Change in %
Shanghai Composite	2057.46	-9.67	-0.47
Hang Seng	21863.51	-31.89	-0.15
Jakarta Composite	4169.83	-1.59	-0.04
KLSE Composite	1721.07	0.70	0.04
Nikkei 225	13360.55	295.38	2.21
Straits Times	3088.85	-0.55	-0.02
KOSPI Composite	1870.16	21.04	1.14
Taiwan Weighted	7873.31	58.93	0.75

Asian markets conclude Friday’s trade on a mixed note

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