Asia report: Most markets higher amid conflicting China data
Markets in Asia closed mostly higher on Thursday, as investors digested conflicting manufacturing data out of China, and cheered promising results from a potential treatment for Covid-19.
In Japan, markets returned from a holiday on Wednesday, with the Nikkei 225 was up 2.14% at 20,193.69, as the yen strengthened 0.01% against the dollar to last trade at JPY 106.67.
Of the major components on the benchmark index, automation specialist Fanuc was up 5.63% and fashion firm Fast Retailing added 5.1%, while technology conglomerate SoftBank Group managed gains of 0.5%.
The broader Topix index was also in the green by the end of trading in Tokyo, rising 1.03% to 1,464.03.
On the mainland, the Shanghai Composite was ahead 1.33% at 2,860.08, and the smaller, technology-heavy Shenzhen Composite gained 1.88% to 1,763.36.
Fresh official data out of China showed a slight expansion in manufacturing activity in April, with Beijing’s manufacturing purchasing managers’ index (PMI) coming in at 50.8 for the month.
That was down from 52.0 in March, and just shy of the 51.0 predicted by analysts polled by Reuters, but was still above the 50-point level that separates expansion from contraction.
The unofficial Caixin/Markit manufacturing PMI painted a different picture, however, coming in at 49.4 for April, which signalled a contraction for the sector and was also below the 50.3 forecast by Reuters polling.
Markets in both South Korea and Hong Kong were closed on Thursday, for public holidays.
Investors in the region were greeted by positive news stateside, as Gilead Sciences said that preliminary results showed more than half of patients treated with the potential Covid-19 treatment ‘remdesivir’ on a five-day dosing regime improved.
Following that, Dr Anthony Fauci - health advisor to the White House - said the National Institute of Allergy and Infectious Disease’s remdesivir trial showed “quite good news” among the 800 patients it had enrolled.
According to the latest data from John Hopkins University, more than three million cases of Covid-19 had now been confirmed globally, with fatalities reaching almost 230,000.
“This news simply acted as an even stronger tailwind for stocks as markets looked beyond the data for the promised land of an economy coming out of lockdown, and slowly restarting against a backdrop of a treatment for Covid-19, quickly followed by a vaccine,” said CMC Markets analyst Michael Hewson.
“Let us hope that this rose-tinted view of the rest of the year doesn’t collide with the hard reality of an earnings wipe-out, as consumer spending struggles to recover against a backdrop of caution and high unemployment.”
Oil prices were higher at the end of the Asian day, with Brent crude last up 12.11% at $25.27 per barrel, while West Texas Intermediate added 15.87% at $17.45.
In Australia, the S&P/ASX 200 was 2.39% firmer at 5,522.40.
Across the Tasman Sea, New Zealand’s S&P/NZX 50 was the odd one out, falling 1.26% to settle at 10,532.07 as investors cashed in their gains for April.
Both of the down under dollars were weaker on the greenback, with the Aussie last 0.22% weaker at AUD 1.5286, and the Kiwi retreating 0.21% to NZD 1.6337.