Asia report: Markets finish higher as RBA stands pat on policy
Markets in Asia finished in the green on Tuesday, with many still closed for public holidays, as investors digested fresh economics data out of Hong Kong and a decision by Australia’s central bank to stand pat on policy.
In Japan, markets were closed for the Children’s Day public holiday, as the yen weakened 0.12% against the dollar to last trade at JPY 106.87.
On the mainland, bourses were closed for the final day of the extended Labour Day public holiday.
South Korea’s traders were also enjoying a day off, to observe Arbour Day, while the Hang Seng Index in Hong Kong was ahead 1.08% at 23,868.66.
Fresh data from the special administrative region’s government showed that its economy shrunk by 8.9% year-on-year for the first quarter, making for its biggest contraction since 1974.
“[The] external environment is still very challenging,” said Hong Kong’s financial secretary Paul Chan, though he added that the coronavirus situation in the city appeared to “be under control”.
“Going forward in the second quarter, we believe that even if there is improvement, the improvement will be gradual and small,” he said.
Oil prices continued to rise at the end of the Asian session after jumping during US trading overnight, with Brent crude last up 6.69% at $29.02 per barrel, and West Texas Intermediate adding 8.63% to $22.15.
In Australia, the S&P/ASX 200 was up 1.64% by the end of trading in Sydney, to close at 5,407.10, as the hefty financials subindex rose.
That came after the Reserve Bank of Australia decided to stand pat on monetary policy in its latest meeting.
“Globally, financial markets are working more effectively than they were a month ago, although conditions have not completely normalised,” said the bank’s governor Philip Lowe.
“The board will not increase the cash rate target until progress is being made towards full employment and it is confident that inflation will be sustainably within the 2%-3% target band.”
After that, Australia and New Zealand Banking Group rose 1.86%, Commonwealth Bank of Australia was ahead 1.62%, National Australia Bank added 3.22%, and Westpac Banking Corporation was 2.73% firmer.
Across the Tasman Sea, New Zealand’s S&P/NZX 50 managed gains of 0.14% to 10,490.73, led higher by outdoor and sports clothing and equipment group Kathmandu, which surded 10.7%.
That came after the company said it was reopening its retail locations in Australia after a month-long closure, with most Kathmandu and Rip Curl stores in the states of New South Wales and Queensland already trading again.
The down under dollars were a mixed picture against the greenback, with the Aussie last ahead 0.06% at AUD 1.5552, while the Kiwi weakened 0.14% to NZD 1.6546.