Asia report: Most markets higher after Pyongyang missile launch

Markets in Asia finished mostly higher on Monday, as traders seemingly brushed off concerns of geopolitical tension after North Korea fired a number of missiles off its east coast.

Japan’s Nikkei 225 was an exception, however, finishing down 0.46% at 19,379.14, with the yen strengthening against the greenback, last advancing 0.21% to JPY 113.80 per $1.

On the mainland, the Shanghai Composite was up 0.5% at 3,234.40, while the smaller, technology-focussed Shenzhen Composite added 1.18% to close at 2,025.5.

Caution was the theme of the day in China, after Premier Li Keqiang told parliament’s annual meeting that China’s economy would expand by about 6.5% in the current year on Sunday.

That compared to the growth target of between 6.5% and 7% set for 2016.

Premier Li also said the country would aim for annual CPI inflation of 3%, and an annual budget deficit of 3% GDP.

The country’s annual National People’s Congress - the world’s largest legislative body - was beginning on Monday, and set down to run until 15 March.

“Stability is the main objective this year, [which] is not surprising given the key 19th Party Plenum in October and November, where the Communist Party of China will name a new set of leaders,” noted Macquarie Bank strategists.

South Korea’s Kospi reversed early losses to finish 0.13% higher at 2,081.36, while Hong Kong’s Hang Seng Index ended the day up 0.18% at 23,596.28.

In Seoul, Korea’s trade minister announced during the session that the country would bolster its response towards recent discrimination of South Korean firms from China.

Reports emerged last week that Beijing had ordered travel agencies in China to halt sales of trips to Korea.

Tensions were high on the geopolitical front, after North Korea fired off a number of ballistic missiles off its eastern coast, with South Korean military agencies saying they flew around 600 miles each.

Japan said three of the missiles landed inside its exclusive economic zone, before adding it would not tolerate such action from the closed state.

Oil prices were lower during Asian trading, with Brent crude last down 0.76% at $55.48 per barrel and West Texas Intermediate also losing 0.76% to $52.93.

In Australia, the S&P/ASX 200 was up 0.3% at 5,746.51, as fresh data showed retail sales improving 0.4% month-on-month in January, which met analyst expectations.

Across the Tasman Sea, the S&P/NZX 50 added 0.2% to 7,178.73, led higher by dairy products and baby food exporter A2 Milk, which was up 4.6%.

Election year debate reared its head in Wellington during the session, as the incumbent National Party announced the country’s state pension age would gradually rise to 67 from 65 in 20 years’ time, among other changes.

All other parties in Parliament expressed opposition to the proposal, ahead of the election in September.

New Zealand has a universal state pension system, known as ‘superannuation’, with all residents over the age of 65 currently receiving the same regular payments regardless of assets or working status.

The down under dollars were both weaker, with the Aussie last retreating 0.02% against the greenback to AUD 1.3167 and the Kiwi last 0.34% weaker at NZD 1.4244 per $1.