Asia report: Markets mixed after better-than-expected China factory data

Markets in Asia finished in a mixed state on Monday, after some surprisingly positive factory activity data came out of China.

In Japan, the Nikkei 225 was down 0.56% at 21,755.84, as the yen weakened 0.04% against the dollar to last trade at JPY 107.96.

Of the major components on the benchmark index, automation specialist Fanuc was off 0.34% and technology conglomerate SoftBank Group slid 2.62%, while fashion firm Fast Retailing was 0.55% higher.

The broader Topix index was 1.03% lower to finish its trading day in Tokyo at 1,587.80.

On the mainland, the Shanghai Composite was off 0.92% at 2,950.19, and the smaller, technology-heavy Shenzhen Composite slipped 1.06% to 1,595.21.

Manufacturing activity in China came in above expectations for September, according to fresh data released during the day.

The unofficial Caixin/Markit factory purchasing managers’ index was 51.4 for the month, above expectations for a reading of 50.2 in a poll of economists conducted by Reuters.

It was an improvement from the 50.4 figure for August as well, with growth above the 50-mark indicating growing expansion for the sector.

Beijing's official indicator was also above expectations, but was still below the 50-mark which separates expansion from contraction at 49.8.

That was above expectations for a reading of 49.5, and was a slight improvement on the 49.5 figure quoted for August.

South Korea’s Kospi was 0.64% firmer at 2,063.05, while the Hang Seng Index in Hong Kong rose 0.53% to 26,092.27.

Anheuser-Busch InBev’s Asia-Pacific business, Budweiser APAC, leapt around 4% in afternoon trading on its debut day, having been priced at HKD 27 per share last week - the lower end of the anticipated range.

The IPO was the second-largest of the year thus far.

Both of the blue-chip technology stocks were in the green in Seoul, with Samsung Electronics rising 1.34% and chipmaker SK Hynix ahead 0.98%.

Developments on the US-China trade front also remained near the top of investor agendas, with a report from CNBC suggesting the White House was considering restrictions on American investments in the People’s Republic.

That, the report said, could possibly include the blocking of all US investments in Chinese companies.

Beijing state-controlled media outlet Global Times said on Sunday that the potential investment curbs were “the latest attempt at a decoupling”.

China’s leading trade negotiator Liu He was expected to lead the latest delegation to the United States after a national holiday celebrating the 70th anniversary of communist rule, which was scheduled for 1 October to 3 October.

“Such [a] move would not only have a tremendous impact on billions worth of investment, but it could also raise the risk of retaliation from China, which has recently removed the quotas for foreign investors in an effort to open its economy,” said London Capital Group senior market analyst Ipek Ozkardeskaya.

“But this could be just a rumour.

“A US Treasury officer said that they have no plans to limit Chinese companies from listing in the US exchanges ‘at this time’.”

Oil prices were lower as the region went to bed, with Brent crude last down 1.54% at $60.97 per barrel, and West Texas Intermediate off 1.07% at $55.32.

In Australia, the S&P/ASX 200 was 0.41% weaker at 6,688.30, while across the Tasman Sea, New Zealand’s S&P/NZX 50 was ahead 0.8% at 10,925.62.

Both of the down under dollars were weaker on the greenback, with the Aussie last off 0.16% at AUD 1.4805, and the Kiwi retreating 0.46% to NZD 1.5955.