Asia report: Hong Kong leads gains on mixed day for region

Investors had their attention fixed on fresh economic data emerging from South Korea and Australia.

“Asian equity indices are treading cautiously as they assess the potential timing and extent of US Fed rate adjustments,” said TickMill market analyst Patrick Munnelly.

“Yesterday saw a decline in US stocks and a selloff in Treasury bonds, notably spurred by the ISM manufacturing index surpassing the 50-point mark for the first time since September 2022, hinting at expansion.

“Eyes are now on Friday’s US monthly labour market data, while Fed chair Powell's upcoming speech on Wednesday is eagerly anticipated.”

Hong Kong leads gains on mixed day for region

In Japan, the market showed mixed signals as the Nikkei 225 slightly advanced by 0.09% to settle at 39,838.91 points, while the broader Topix index retreated 0.25% to 2,714.45 points.

Stocks such as Sumco, Sumitomo Metal Mining, and Trend Micro saw significant gains, leading the benchmark index higher.

Contrastingly, China's markets faced a slight downturn, as the Shanghai Composite dipped by 0.08% to 3,074.96 points, while the Shenzhen Component fell more substantially by 0.62% to 9,586.95 points.

The decline in Shanghai was led by notable drops in shares of Inly Media and AA Industrial Belting Shanghai, both experiencing significant sell-offs.

Hong Kong's Hang Seng Index, however, was the standout performer, surging by 2.36% to reach 16,931.52 points.

Major contributors to the rally included BOC Hong Kong, Trip.com Group, and Xiaomi, each posting impressive gains and driving the index upwards.

In South Korea, the Kospi index modestly increased by 0.19% to 2,753.16 points, supported by sharp rises in Hanwha Aerospace and Amorepacific shares.

Conversely, Australia's S&P/ASX 200 slightly declined by 0.11% to 7,887.90 points, with Orora and Megaport leading the losses.

New Zealand's market mirrored the cautious sentiment with the S&P/NZX 50 index dropping slightly by 0.08% to 12,095.85 points, as Synlait Milk and Tourism Holdings faced downward pressure.

Currency markets saw minor fluctuations, with the dollar last 0.03% stronger on the yen to trade at JPY 151.69.

The greenback was meanwhile weaker against its downunder counterparts, fling 0.29% on the Aussie to AUD 1.5365, and retreating 0.09% from the Kiwi, changing hands at NZD 1.6782.

In the commodities sector, Brent crude futures were last up 1.83% on ICE at $89.02 per barrel, while the NYMEX quote for West Texas Intermediate increased 1.97% to $85.36.

Korean inflation remains unchanged, Australian manufacturing sector slows

In economic news, South Korea's inflation rate remained unchanged in March, matching market expectations.

Inflation persisted at 3.1% on a year-over-year basis, matching the expectations set by a Reuters survey of economists.

On a month-to-month comparison, the consumer price index saw a marginal increase of 0.1%, marking a deceleration from February's 0.5% rise and falling short of the anticipated 0.3%.

Australia's manufacturing sector meanwhile encountered a significant slowdown, recording its sharpest contraction since May 2020.

A private survey conducted by Judo Bank highlighted a decline in the country's purchasing managers' index (PMI) to 47.3 in March, down from 47.8 in February.

It marked the second consecutive month of contraction for the sector.

Judo Bank attributed the downturn to a notable decrease in new work inflows, which subsequently led to diminished manufacturing output.

Additionally, the survey revealed downturns in employment and purchasing levels, along with a dip in overall business confidence during March.

Reporting by Josh White for Sharecast.com.