Asia report: Markets mixed as investors digest Japan trade data

Asian markets saw a mixed performance on Wednesday, with notable gains in Hong Kong.

Investors in the region reacted to positive trade data from Japan and overnight advances in US markets, particularly driven by the rise of Nvidia as the world's most valuable public company.

“Asian stocks rose on Wednesday, driven by optimism for AI, while the dollar remained stable,” said TickMill market analyst Patrick Munnelly.

“The MSCI Asia Pacific index increased by 0.8%, led by chip and artificial intelligence-related stocks.”

Munnelly said Taiwan and South Korea's chipmakers saw their share prices rise by 1.5% and 1% respectively.

“Mainland Chinese equities fell while Hong Kong stocks advanced.#

“Japan's exports also increased at a rapid rate due to the weakening yen, which had not moved much after a four-session decline.”

Most markets in the green after solid Wall Street session

Japan's Nikkei 225 rose 0.23% to 38,570.76, and the Topix increased by 0.47% to 2,728.64.

Strong performances were seen from Mitsubishi Motors, up 8.98%; Advantest, ahead 4.07%; and Mitsui Mining and Smelting, which was 3.96% firmer.

Contrarily, China's markets faced declines, as the Shanghai Composite fell 0.4% to 3,018.05, and the Shenzhen Component dropped 1.07% to 9,219.07.

Major losers included Shanghai Lingyun Industries Development, down 10.21%; Orient Group, off 9.63%; and Shanghai Tongda Venture Capital, which lost 9.5%.

Hong Kong's Hang Seng Index jumped 2.87% to 18,430.39, driven by strong performances from energy and tech stocks.

Lenovo Group leapt 9.03%, Xiaomi gained 6.33%, and CNOOC climbed 5.83%, leading the market higher.

South Korea's Kospi index increased by 1.21% to 2,797.33.

Hanwha Aerospace surged 7.96%, Doosan Heavy Industry rose 7.25%, and LG Electronics advanced 6.09%, reflecting a broad-based rally in industrial and technology stocks.

The Australian market saw a slight decline, with the S&P/ASX 200 down by 0.11% to 7,769.70.

Beach Energy and QBE Insurance Group both fell by 4.25%, while Reliance Worldwide dropped 4%, reflecting a pullback in various sectors.

New Zealand's S&P/NZX 50 decreased by 0.82% to 11,671.19, led lower by Fletcher Building, down 4.01%; Genesis Energy, off 3.7%; and Synlait Milk, which lost 3.33%.

In currency markets, the dollar was last down 0.06% on the yen to trade at JPY 157.77, while it fell 0.21% against the Aussie to AUD 1.4992.

The greenback meanwhile rose 0.09% on the Kiwi, changing hands at NZD 1.6290.

Oil prices experienced minor declines, with Brent crude futures last down 0.21% on ICE at $85.15 per barrel, and the NYMEX quote for West Texas Intermediate slipping 0.49% to $81.17.

Japan export growth comes in stronger than expected

In economic news, investors analysed Japan's latest trade data for May, which revealed a stronger-than-expected increase in exports.

Exports surged 13.5% year-on-year, surpassing the 13% growth anticipated by economists surveyed by Reuters.

However, import growth did not meet expectations, rising by 9.5% compared to the forecasted 10.4%.

In addition to trade data, market participants also digested the latest Reuters Tankan survey readings, which presented a mixed picture of business confidence in Japan.

The index for large manufacturers fell to +6 in June, down from +9 in May, indicating a decline in optimism within the manufacturing sector.

That drop reflects concerns among manufacturers about potential challenges such as supply chain disruptions and fluctuating global demand.

Conversely, the business confidence index for non-manufacturers showed improvement, climbing to +31 from +26 in May.

The rise signified growing optimism in the services sector, likely driven by increased consumer spending and a rebound in domestic activities.

Reporting by Josh White for Sharecast.com.