Asia report: Markets close higher on lockdown easing hopes

Markets in Asia finished in the green on Monday, as the Bank of Japan announced fresh easing measures and investors digested the latest developments in the ongoing Covid-19 coronavirus pandemic.

In Japan, the Nikkei 225 was up 2.71% at 19,783.22, as the yen strengthened 0.42% against the dollar to last trade at JPY 107.06.

Of the major components on the benchmark index, automation specialist Fanuc was up 11.95%, Uniqlo owner Fast Retailing was 2.94% higher, and technology giant SoftBank Group was ahead 4.48%.

The broader Topix index was 1.83% firmer, closing its trading day at 1,447.25.

During the day, the Bank of Japan announced new easing measures designed to help underpin the country’s economy amid the coronavirus crisis.

It said it would increase its corporate bond and commercial paper purchases, as well as intensify its buying of treasury bills and Japanese government bonds.

At the same time, the central bank stood pat on its short-term interest rate target at -0.1%, and reaffirmed its goal to keep the 10-year Japanese government bond yield at around 0%.

“The Bank of Japan met this morning against a backdrop of a Japanese economy struggling with a rising infection and death rate, after the Japanese government lifted some of their earlier protective measures too early,” said CMC Markets analyst Michael Hewson.

“The central bank left monetary policy unchanged as well increasing the limits on its corporate bonds and commercial paper programs, as well as removing the limits on its purchases of Japanese government bonds.”

Hewson said that had been “widely trailed” at the end of last week, so was expected.

“The bank also modified its forward guidance in a signal that its immediate priority is the economy and not its inflation target.”

On the mainland, the Shanghai Composite was 0.25% higher at 2,815.49, and the smaller, technology-focussed Shenzhen Composite eked out gains of 0.06% ato 1,738.05.

In fresh data out of China, new data showed industrial profits plunging 34.9%, according to the Bureau of Statistics, as a result of the Covid-19 outbreak, which began in the country’s Hubei province in December.

South Korea’s Kospi was ahead 1.79% at 1,922.77, while the Hang Seng Index in Hong Kong added 1.88% to 24,280.14.

Both of the blue-chip technology stocks were in the green in Seoul, with Samsung Electronics up 1.01% and chipmaker SK Hynix rising 1.47%.

Oil prices continued their turbulent movements throughout the Asian day, ending it in the red, with Brent crude last down 5.62% at $20.30 per barrel, and West Texas Intermediate 22.84% weaker at $13.79.

In Australia, the S&P/ASX 200 was up 1.5% at 5,321.40.

Markets in New Zealand were closed for the ANZAC Day public holiday, although the country was gearing up for a partial easing of its coronavirus lockdown on Tuesday.

Both of the down under dollars were stronger on the greenback, with the Aussie last ahead 1.11% at AUD 1.5471, and the Kiwi advancing 0.82% to NZD 1.6482.