Asia report: Most markets fall as Aussie jobs market narrows

Markets in the Asia-Pacific region were in a mixed state on Thursday, with Hong Kong stocks rebounding while mainland China shares also rose after languishing near five-year lows.

Patrick Munnelly at TickMill Group said most markets in the region were showing negative trends as central bank rate cut expectations were reversed.

“The Nikkei 225 fluctuated between gains and losses, influenced by recent currency weakness and disappointing machinery orders,” he noted.

“Japan is set to release the latest December consumer price index (CPI) inflation data overnight.

“Expectations are for a moderation in the headline measure to 2.5% from November's 2.8%, while the core measure, excluding fresh food, is forecasted to decline to 2.3% from 2.5%.”

Munnelly said the data was likely to support the view that the Bank of Japan was in no hurry to depart from its ultra-easy policy settings.

“The Hang Seng and Shanghai Composite indices had mixed performance, with the Hong Kong benchmark stabilising after a significant drop yesterday, while the mainland index fell to its lowest level since 2020 due to recent data and disappointment over rate cuts before staging a late day recovery trade with gains of over 1% with market chatter suggesting potential official intervention was seen supporting the index.”

Most markets lower on mixed day for region

In Japan, the Nikkei 225 edged down by 0.03% to close at 35,466.17, while the Topix index slipped by 0.17% to reach 2,492.09.

Among the leading decliners on Tokyo’s benchmark were Resonac Holdings, down by 3.21%, Sumitomo Chemical, which dropped by 3.14%, and Shiseido, which saw a decrease of 2.87%.

Conversely, mainland China saw positive movements, with the Shanghai Composite rising by 0.43% to 2,845.78, and the Shenzhen Component surging by 1% to 8,847.00.

Henan Ancai Hi-tech and Daqian Ecology & Landscape posted significant gains in Shanghai, rising 10.04% and 10.02%, respectively.

Hong Kong's Hang Seng Index also showed resilience, climbing by 0.75% to reach 15,391.79.

Prominent gainers in the special administrative region included Orient Overseas International, up by 5.24%, Xinyi Solar, which gained 5.03%, and Sino Biopharmaceutical, with a rise of 4.47%.

South Korea's Kospi index recorded a modest increase of 0.17% to settle at 2,440.04.

Notable performers in South Korea included Amorepacific, up by 7.67%, and LG Household & Healthcare, which gained 6.72%.

In Australia, the S&P/ASX 200 experienced a slight decline of 0.63%, closing at 7,346.50, led lower by Liontown Resources, down by 10.66%, and Summerset Group, which saw a decrease of 5.87%.

Similarly, New Zealand's S&P/NZX 50 index also saw a decrease of 0.68% to end the day at 11,687.18.

Wellington’s losses were led by Synlait Milk, with a drop of 7.45%, and Heartland Group, down by 2.7%.

On the currency front, the dollar was last down 0.23% on the yen to trade at JPY 147.82, while it dropped 0.26% against the Aussie to AUD 1.5223.

The greenback also saw a marginal decline on the Kiwi, retreating 0.07% to change hands at NZD 1.6335.

In oil markets, Brent crude futures were unchanged on ICE at $77.88 per barrel, while the NYMEX quote for West Texas Intermediate rose 0.19% to $72.70.

Labour market faces unexpected drop in December

In economic news, Australia's job market experienced an unexpected setback in December.

According to official data, the number of employed individuals in the country unexpectedly dropped by 65,100 people, a stark contrast to the anticipated increase of 17,600 people projected in a Reuters poll of economists.

Moreover, the unemployment rate remained stagnant at 3.9%, the same as in November, marking the highest level in 19 months.

Australia's labour participation rate also saw a more substantial decrease than initially predicted.

It fell to 66.8%, down from the estimated 67.1% and lower than the previous month's rate of 67.2%.

“Both the unemployment and underemployment rates remained relatively low and the participation rate and employment-to-population ratio relatively high, suggesting that the labour market remains tight,” said David Taylor, head of labour statistics at the Australian Bureau of Statistics.

Reporting by Josh White for Sharecast.com.