Asia: Stocks mixed as Japan hit by weak dollar, China recovers from disappointing data

Asian stocks remained mixed on Thursday with China recovering from Wednesday's weak data but Japan being hurt by a stronger currency.

Japan's Nikkei 225 shed 0.98% due to a stronger yen against a weaker dollar, which drove gold prices up. The yen was trading at ¥119.23 at 12:00 BST.

Machine tool orders declined in April to 10.4% from 14.9%, while money supply remained at 3.6% as expected.

In economic news, retail group Fast Retailing fell 2.5% and Toyota remained lower by 0.34% on day after it reported it would recall nearly 5m cars from its Corolla and Vitz models to replace potentially faulty airbag inflators made by Takata.

In China, the Shanghai composite index closed up 0.06% and Hong Kong's Hang Seng was higher 0.14%, recovering from Wednesday's losses after disappointing retail sales and industrial production data.

Julian Evans-Pritchard, China economist at Capital Economics said that he remains optimistic that the government’s annual growth target of “about 7%” can be achieved.

"The People’s Bank’s looser policy stance should begin to shore up activity in the coming months," Evans-Pritchard said.

Money supply declined to its slowest rate in 15 years to 10.1% in April against forecasts of 11.9%. New loans also fell to 707.9bn from 1.18trn.

The week data hurt base metals prices, with copper, zinc, tin and nickel three-month contracts on the London Metal Exchange ending Wednesday in the red.

Australia's ASX was on the red by 0.32% despite the previous day's gains following the release of the federal budget.

Fitch Rating analysts warned at the time that the budget highlights the "continued weakening of the country's long-term fiscal consolidation plans".

"Australia does benefit from a credible policy framework and Fitch expects Australia to continue to have a significantly lower debt burden than its 'AAA'-rated peers."

BHP Billiton lost 1.02% and Rio Tinto was down 0.84% as they face political tension in Australia over taxes and oversupply in the iron ore market.