Asia: Stocks rally as Chinese data misses forecasts
Asian stocks advanced as weaker-than-forecast Chinese data supported arguments for loose policy and as investors weighed solid corporate earnings.
Dentsu gained in Japan as the ad agency's loss for the three months ended June narrowed.
CSL advanced in Sydney after the maker of blood-derived therapies reported a rise in annual net income that met analysts' estimates.
Amorepacific Group led consumer staples stocks higher after brokers raised their target prices on the South Korean maker of cosmetics.
China, Japan data
New bank loans in China totalled just 385.2bn yuan in July, sharply lower than the 1.08trn yuan lent out in June and well below the 780bn yuan forecast.
Chinese factory output rose 9% in in July after a 9.2% lift in June. Analysts had expected it to rise at the same rate as June.
A separate report showed China retail sales gained 12.2% in July after rising 12.4% a month earlier, falling short of analysts' estimates for a 12.5% increase.
"Today's data on lending, output and spending for July suggest that, after a strong second quarter, China's economy slowed at the start of the third quarter," Capital Economics said.
"Policymakers are likely to continue to provide targeted support to those sectors that are struggling the most but a more general loosening of policy remains unlikely."
Japan suffered its worst economic contraction in the second quarter since the tsunami of 2011 as consumer spending plummeted at a record pace, the government revealed in its preliminary estimate. Annualised gross domestic product declined 6.8% following a 6.1% increase the previous quarter, surprising analysts who had expected a fall of 7%.
"But evidence points to a rebound in the current quarter," according to Daiwa Capital Markets. "The Bank of Japan won't be panicked into easing policy further. And today's data certainly do not represent a show-stopper for Abenomics."
RD