Asia: China trade data impresses, Japanese stocks follow US losses

Asian stocks were mixed on Tuesday as China revelled in positive trade data but Japan's Nikkei index decreased following a decline in the energy sector in the US.

The Nikkei 225 was down 0.64% as yields on five-year bonds hit zero for the first time ever.

The Japanese index also suffered from lower US shares after oil prices continued to decline, affecting the energy sector.

Brent crude dropped 3.4% to $45.87 per barrel in morning trade, according to the ICE.

Jim Reid of Deutsche Bank noted that following a larger than expected trade surplus print in Japan too, boosted by a weaker yen, five-year Japanese government bonds have declined to 0.001% having briefly traded in negative territory – "joining just Germany and Switzerland as the only nations with negative five-year yields".

On the bright side, Hong Kong's Index Hang Seng was up 0.79% and China' Shanghai rose 0.19% after better-than-expected Chinese data.

The Chinese trade balance narrowed by around $5bn to $49.61bn in December, from $54.47bn in November, slightly above forecasts of $49bn.

Exports from the People's Republic jumped a surprising 9.7% in the month, higher than the 6% rise estimated by analysts, with imports dropping by a much smaller 2.4% than the expected 6.2% fall.

“It was interesting to see how little an impact the Chinese trade balance figures had on oil prices overnight, as they continued to tumble despite the world's second largest economy importing a record amount of crude, above seven million barrels per day,” said Craig Erlam, analyst at Alpari UK.

“This clearly shows that while global demand may be weaker that it's been in the past, the collapse of oil prices really is largely driven by the supply glut and the demand side just isn't helping matters.”