Asia report: Stocks mixed as investors digest US inflation

Asia-Pacific markets closed mixed on Wednesday, after a surge on Wall Street overnight was spurred by US inflation data that closely aligned with expectations.

According to the Bureau of Labor Statistics, the US consumer price index (CPI) for February rose 0.4% on a monthly basis and 3.2% year-on-year, in line with economists' forecasts.

Core inflation, which excludes food and energy prices, was also ahead 0.4% in February, slightly surpassing expectations.

“Most Asian stock markets are experiencing gains on Wednesday, taking direction from the overall positive performance of global markets,” said TickMill market analyst Patrick Munnelly.

“This was influenced by the favourable response to the long-awaited report on US consumer price inflation for February, which indicated a decrease in core price growth.

“This has increased optimism about the possibility of the US Federal Reserve reducing interest rates in June.”

Munnelly said the Japanese market opened in the green, but was in modest decline by the end of the day, continuing a trend from the last two sessions.

“This is happening despite the generally positive signals from global markets overnight.

“The Nikkei 225 index is dropping below the 38,800 handle, mainly due to losses in major index components and companies that export goods.

“Today in Japan, major corporations are expected to propose substantial salary increases as wage negotiations come to a close.”

That, Munnelly said, could reignite hopes for a potential departure from the Bank of Japan's accommodative policy, a sentiment that BoJ governor Kazuo Ueda downplayed on Tuesday.

Nikkei falls further on mixed day for region’s equities

In Japan, the Nikkei 225 index experienced a marginal decline of 0.26%, closing at 38,695.97, while the Topix index dipped by 0.33%, settling at 2,648.51.

Among the biggest decliners on Tokyo’s benchmark were Kawasaki Kisen Kaisha, down 3.74%; Bandai Namco, off 3.22%; and Chugai Pharmaceutical, which lost 3.18%.

Meanwhile, Chinese markets saw the Shanghai Composite and Shenzhen Component indices retreat by 0.4% and 0.27%, respectively, to 3,043.83 and 9,604.99.

China Pacific Insurance Group was down 7.1% and Guangdong Rongtai Industry lost 5.09% to lead the losers in Shanghai.

In Hong Kong, the Hang Seng Index ended the day almost flat, falling by a marginal 0.07% to reach 17,082.11.

Sinopharm Group, New World Development and Zhongsheng Group were among the top losers, falling 3.84%, 3.83% and 3.76%, respectively.

Conversely, South Korea's Kospi index managed a modest 0.44% gain, closing at 2,693.57.

NH Investment & Securities and KB Financial Group were among the top performers, rising a respective 6.56% and 5.87%.

Australia's S&P/ASX 200 index edged up by 0.22%, settling at 7,729.40, with notable gainers including PSC Insurance Group, up 6.19%, and Liontown Resources ahead 6.08%.

New Zealand's S&P/NZX 50 index experienced a slight decline of 0.17%, closing at 11,809.02, led lower by Serko and Oceania Healthcare with falls of 3.5% and 3.23%, respectively.

In currency markets, the dollar was last up 0.18% on the yen, trading at JPY 147.95, while the it declined 0.03% and 0.06% against the Aussie and Kiwi, changing hands at AUD 1.5134 and NZD 1.6249, respectively.

On the oil front, Brent crude futures were last up 1.16% on ICE at $82.87 per barrel, while the NYMEX quote for West Texas Intermediate was ahead 1.19% at $78.48.

Unemployment down in Korea, India inflation dips in February

In economic news, official data showed that South Korea's unemployment rate stood at a seasonally adjusted rate of 2.6% in February, marking a slight decrease from January's rate of 3%.

It was the lowest unemployment rate since October.

Meanwhile, in India, inflation for February dipped marginally to 5.09% from 5.10% in January, according to data from the National Statistical Office.

That did, however, slightly exceed economists' expectations, as a Reuters poll had anticipated a lower inflation rate of 5.02%.

The data further revealed that the rise in prices was primarily driven by the food and beverages sector, which experienced an inflation rate of 7.76% in February.

Reporting by Josh White for Sharecast.com.