Asia report: Japan markets rise on mixed day for region

Stocks in the Asia-Pacific region closed on a mixed note on Friday, as Japan's Nikkei 225 briefly surged past the 41,000 mark before giving up some gains by the close.

The new all-time intraday high came amid accelerating inflation in the country in February.

“Asian equity markets are displaying mixed performance this morning, despite gains seen in European and US markets yesterday,” said TickMill market analyst Patrick Munnelly.

“Bank of Japan governor Ueda stated that the BoJ will allow longer duration bond yields to be determined by markets and may reduce purchases at some point.

“In a continuation of yesterday's monetary policy update, Bank of England governor Bailey, in an FT article, indicated that interest rate cuts were under consideration, suggesting that markets are justified in anticipating multiple rate reductions this year.”

Japan markets rise, most others in the region fall

In Japan, the Nikkei 225 closed with a 0.18% gain at 40,888.43, while the broader Topix index rose 0.61% to 2,813.22.

Shares of Sharp Corporation led the risers on Tokyo’s benchmark, adding 5.19%, followed by Suzuki Motor with a gain of 3.63%, and Nissan Motor, which advanced 3.36%.

Conversely, China's stocks faced downward pressure, with the Shanghai Composite slipping by 0.95% to 3,048.03, and the Shenzhen Component declining by 1.21% to 9,565.56.

Dali Pharmaceutical and Eastern Pioneer Driving School were among the biggest losers, falling 10.02% and 9.17%, respectively.

In Hong Kong, the Hang Seng Index ended notably lower, down 2.16% at 16,499.47.

Shares of Orient Overseas International lost 16.71% and JD Health International gave up 12.62%, while Li Auto slid 10.88% after it revised its first-quarter delivery outlook, expecting to deliver fewer vehicles than initially forecast.

South Korea's Kospi index saw a slight dip of 0.23% to 2,748.56, with LG Display and Hyundai Motor among the biggest losers, falling 4.1% and 3.37%.

Australia's S&P/ASX 200 ended marginally lower, down by 0.15% at 7,770.60, with Genesis Minerals down 6.25% and Cettire falling 6.24%.

On a positive note, New Zealand's S&P/NZX 50 index closed 0.52% higher at 11,978.62, supported by gains in Fisher & Paykel Healthcare and Manawa Energy of 5.68% and 3.76%, respectively.

In currency markets, the dollar was last down 0.01% on the dollar to trade at JPY 151.61.

However, the greenback strengthened 0.83% against the Aussie to AUD 1.5348, and advanced 0.69% against the Kiwi to change hands at NZD 1.6660.

Oil prices experienced slight gains, with Brent crude futures last up 0.07% on ICE at $85.84 per barrel, and the NYMEX quote for West Texas Intermediate edging up 0.09% to $81.14.

Headline inflation rises in Japan, South Korea producer prices advance

In economic news, Japan’s headline inflation rose 2.8% in February, marking a notable increase from January's 2.2% and halting a three-month decline streak.

Similarly, the core inflation rate, excluding fresh food prices, rose to 2.8%, aligning with expectations from a Reuters poll of economists.

Notably, the ‘core-core’ inflation metric, which also excluded energy prices and is closely monitored by the Bank of Japan, climbed to 3.2%, up from January's 2.6%.

South Korea meanwhile saw a rise in its producer price index (PPI), which increased 1.5% year-on-year in February, surpassing January's 1.3% and marking the fastest rate since April last year.

On a month-on-month basis, the PPI grew 0.5%, outpacing January's 0.3% gain.

Meanwhile, China's securities regulator reportedly initiated inspections into mutual fund companies, as per a Reuters report citing local newspaper 21st Century Business Herald.

The inspections, carried out by local branches of the China Securities Regulatory Commission, focussed on various aspects including daily operations, training, and Chinese Communist Party building.

Although the report did not specify the names of the inspected asset managers, it followed recent efforts by the CSRC to establish a rigorous supervision model for China's $3.8trn mutual fund industry.

Finally, in an unexpected move, Taiwan's central bank raised its main policy rate from 1.875% to 2%, the highest level since 2008, according to an official statement.

The Central Bank of the Republic of China (Taiwan) cited persistent inflation since 2021 and the possibility of an upcoming electricity rate hike in April as factors driving the decision.

Reporting by Josh White for Sharecast.com.