Asia report: Japan and Australia rise on a quiet day

Markets in Japan and Australia finished higher ona quiet Tuesday in Asia, with a number of other countries remaining closed for a public holiday, as the Reserve Bank of Australia stood pat on interest rates.

In Japan, the Nikkei 225 was up 0.18% at 22,508.03, as the yen weakened 0.27% against the dollar to last trade at JPY 109.63.

The broader Topix was down 0.17%, settling at 1,774.18.

Markets in China, Hong Kong and South Korea were closed for a holiday.

Oil prices were lower, with Brent crude last down 0.8% at $74.10 per barrel and West Texas Intermediate falling 1.06% to $67.85.

In Australia, the S&P/ASX 200 was up 0.54% at 6,015.20, with the hefty financials subindex rising 1.37% as all the major banks gained at least 1.4% each.

Australia and New Zealand Banking Group was ahead 2.35%, Commonwealth Bank of Australia rose 1.88%, National Australia Bank added 1.73%, and Westpac Banking Corporation finished 1.43% higher.

The market was cheered by news that Australia and New Zealand Banking Group beat market expectations for its first half profits, with cash profit from continuing operations up 4% to AUD 3.49bn in the six months to 31 March.

Analysts were anticipating a figure of AUD 3.46bn.

The profit growth was reportedly boosted by a reduction in both costs and bad debt charges.

Energy was also a winner in the sunburnt country, with Oil Search up 1.02%, Santos ahead 0.49% and Woodside Petroleum rising 0.62%.

On the economic front on Australia, the Reserve Bank left its official cash rate unchanged at 1.5% - a move widely expected by market watchers.

The central bank’s governor Philip Lowe said they were expecting the Australian economy to improve, hitting average growth of more than 3% in 2018 and 2019.

Inflation was also expected to rise, with the bank picking it to hit more than 2% in 2018.

“Business conditions are positive and non-mining business investment is increasing,” Lowe said in his statement.

“Higher levels of public infrastructure investment are also supporting the economy. Stronger growth in exports is expected.”

The governor also noted that, while low interest rates had underpinned the economy, there was still the problem of slow growth in household income and very high household debt levels.

Across the Tasman Sea in New Zealand, the S&P/NZX 50 fell 0.09% to 8,435.97, led lower by commercial and retail property operator Kiwi Property, which lost 2.6%.

Both of the down under dollars were weaker on the greenback, with the Aussie last off 0.28% at AUD 1.3318, and the Kiwi retreating 0.33% to NZD 1.4262.