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Asian Markets Follow U.S Tech Selloff

Asian stocks ended mostly lower on Wednesday after a continued rise in the U.S. 10-year Treasury yields pulled down U.S. tech shares sharply lower overnight.

News reports on North Korea firing a ballistic missile off its east coast also kept underlying sentiment cautious.

China’s Shanghai Composite index fell 37.15 points, or 1.02 percent, to 3,595.18 after an index of Chinese companies traded in New York fell the most in more than two weeks.

Hong Kong’s Hang Seng index slumped 382.59 points, or 1.64 percent, to 22,907.25, with tech stocks retreating on concerns that Tencent Holdings will keep cutting its stakes in a host of companies following several recent billion-dollar divestment plans.

Japanese shares ended flat with a positive bias as gains in Toyota Motor and Sony Group offset losses in the tech sector.

The Nikkei average edged up 30.37 points, or 0.10 percent, to 29,332.16 ahead of the release of the U.S. Federal Reserve’s December meeting minutes later in the day. The broader Topix index rose 9.05 points, or 0.45 percent, to 2,039.27.

Toyota Motor rallied 2.6 percent after it surpassed General Motors to grab the best-seller crown in the U.S. for 2021.

Sony Group jumped 3.7 percent after the game maker announced it is exploring the commercial launch of its own electric vehicle.

Australian shares gave up early gains to end slightly lower for the day, with technology and healthcare stocks pacing the declines. Energy and mining stocks advanced, helping lift the downside in the broader market.

The benchmark S&P/ASX 200 index dipped 24 points, or 0.32 percent, to 7,565.80 while the broader All Ordinaries index ended down 27.20 points, or 0.34 percent, at 7,899.60.

Xero, Afterpay and Wisetech Global lost 3-4 percent amid concerns over rising bond yields. Hearing device maker Cochlear declined 2.8 percent and biotech major CSL gave up 1.8 percent.

Seoul stocks tumbled amid Covid-19 worries and on expectations for a Fed rate hike this year. The Kospi average fell 35.27 points, or 1.18 percent, to close at 2,953.97.

Market heavyweight Samsung Electronics declined 1.7 percent, chipmaker SK Hynix lost 2.3 percent and internet portal operator Naver shed 2.9 percent.

New Zealand shares ended sharply higher in the first trading day of the year, with the benchmark NZX-50 index climbing 116.61 points, or 0.89 percent, to 13,150.38 – its highest since late October 2021.

Infrastructure investment firm Infratil jumped 3.8 percent after one of its key assets had its valuation boosted 15 percent.

U.S. stocks ended mixed overnight, a day after the country reported more than 1 million new Covid cases. The Dow rose 0.6 percent to reach a new record closing high as banks benefited from rising Treasury yields.

The S&P 500 finished marginally lower while the Nasdaq Composite tumbled 1.3 percent, reflecting substantial weakness among software and biotechnology stocks.

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Japan’s Manufacturing Growth Slows Marginally In December

Japan’s manufacturing sector grew at a slightly slower pace in December, survey results from IHS Markit showed on Tuesday.

The au Jibun Bank manufacturing Purchasing Managers’ Index fell to 54.3 in December from 54.5 in November. A reading above 50.0 indicates expansion.

The lower reading of the headline index was partly the result of a softer rise in output levels. New orders also rose at a softer pace at the end of 2021.

Employment increased for the ninth straight month in December and the rate of job creation was the fastest recorded since April 2018.

In response to ongoing supply chain disruption, buying activity rose at the sharpest pace since May.

On the price front, the survey showed that input prices rose for the nineteenth month running but the rate of inflation softened from November. Meanwhile, output prices increased for the thirteenth consecutive month, though the pace of inflation was the slowest since September.

Business confidence regarding activity over the coming year eased in December. The degree of positive sentiment was the weakest since August.

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Chinese Manufacturing Sector Recovers In December

China’s manufacturing sector rebounded in December as firms signaled the strongest growth in output for a year amid a renewed uptick in total sales, survey results from IHS Markit showed on Tuesday.

The Caixin manufacturing Purchasing Managers’ Index rose to 50.9 in December from 49.9 in November. The reading was forecast to rise marginally to 50.0.

A reading above 50.0 indicates expansion in the sector. Although marginal, the rate of improvement was the strongest seen since June, the survey showed.

According to official survey from the National Bureau of Statistics, released over the weekend, the factory PMI climbed to 50.3 in December from 50.1 in November. The services PMI came in at 52.7, up from 52.3 in the previous month.

Output rose at the fastest rate for twelve months and solidly overall, supported by improved market conditions and stronger customer demand, IHS survey showed. New work rose for the third time in the past four months in December.

Employment decreased for the fifth month in a row, and at the fastest rate since February.

Purchasing activity also returned to growth at the end of the year. Though moderate, the upturn was the quickest seen since June. Meanwhile, stocks of inputs and finished goods rose slightly.

Average input costs rose at the weakest rate for 19 months in December, with the rate of inflation having fallen further from October’s recent peak. On the other hand, prices charged decreased for the first time since April 2020.

Business confidence remained strong overall in December but the degree of optimism slipped to a 20-month low.

“As policymakers said at the Central Economic Work Conference that China’s economic growth is facing triple pressures of “demand contraction, supply shock and weakening expectation,” stabilizing the economy will become the key priority of economic work in 2022,” Wang Zhe, a senior economist at Caixin Insight Group, said.

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Indonesian Inflation At 18-Month High

Indonesia’s consumer price inflation increased to the highest level in eighteen months in December, data from the statistics bureau showed on Monday.

Consumer prices rose 1.87 percent year-on-year in December, following a 1.75 percent increase in November. Economists had expected a rate of 1.80 percent.

The latest inflation was the highest since June last year, when it was 1.96 percent.

Core inflation was 1.56 percent in December versus 1.44 percent in the previous month. Economists had expected 1.52 percent.

On a monthly basis, consumer prices rose 0.57 percent in December, following a 0.37 percent increase in November. Economists had expected a 0.52 percent rise.

Prices for food, beverages and tobacco rose 1.61 percent yearly in December and prices for clothing and footwear grew by 0.22 percent.

Transportation cost gained 0.62 percent annually and prices for household equipment, equipment, and routine maintenance rose 0.24 percent.

For the January to December period, inflation was 1.87 percent.

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Mixed Trading in Asian Markets

Asian stock markets are trading mixed on Thursday, following the mixed cues overnight from Wall Street, as investors delve over the potential impact of the fast spreading Omicron Coronavirus variant. They also seem reluctant to continue making significant moves as the virus spreads rapidly across more countries, with some implementing lockdowns and strict restrictions. Asian markets closed mixed on Wednesday.

While Omicron has contributed to a surge in new coronavirus cases around the world, traders seem optimistic that the milder symptoms associated with the new strain will not lead to a significant economic slowdown.

The Australian stock market is slightly lower in choppy trading on Thursday, after five straight sessions of gains, with the benchmark S&P/ASX 200 staying just above the 7,500 level, following the mixed cues overnight from Wall Street, as traders fret over the surge in the country’s Covid-19 infections due to the rapid spread of the Omicron variant. Weakness in technology stocks were partially offset by strength in materials and mining stocks.

Domestically, New South Wales reported a new daily record of 12,226 new cases and one death on Wednesday. Victoria reported a new daily record of 5,137 new cases and 13 deaths. Queensland recorded 2,222 new cases.

The benchmark S&P/ASX 200 Index is losing 6.00 points or 0.08 percent to 7,503.80, after hitting a low of 7,499.90 and a high of 7,520.60 earlier. The broader All Ordinaries Index is down 8.20 points or 0.11 percent to 7,832.10. Australian markets ended sharply higher on Wednesday.

Among major miners, BHP Group and Mineral Resources are gaining almost 2 percent each, while OZ Minerals is adding almost 1 percent, Rio Tinto is up more than 1 percent and Fortescue Metals is flat.

Oil stocks are mostly lower. Woodside Petroleum and Origin Energy are edging down 0.3 percent each, while Santos is edging up 0.5 percent. Beach Energy is declining more than 1 percent.

Among the big four banks, Commonwealth Bank and Westpac are edging up 0.4 percent each, while ANZ Banking is edging down 0.2 percent. National Australia Bank is edging up 0.2 percent.

In the tech space, Afterpay is losing almost 3 percent, Zip is declining more than 2 percent and Appen is down 1.5 percent, while Xero is edging up 0.1 percent. WiseTech Global is flat. Gold miners are mostly lower. Newcrest Mining is edging down 0.5 percent and Evolution Mining is declining more than 1 percent, while Gold Road Resources and Northern Star Resources are losing almost 1 percent each. Resolute Mining is gaining more than 1 percent.

In the currency market, the Aussie dollar is trading at $0.726 on Thursday.

The Japanese stock market is slightly lower on Thursday, extending the losses in the previous session, with the benchmark Nikkei 225 just below the 28,900 level, following the mixed cues overnight from Wall Street, as traders braced for a feared rebound in coronavirus cases at the start of New Year’s holidays due to the rapid spread of the Omicron variant.

The benchmark Nikkei 225 Index closed the morning session at 28,886.09, down 20.79 points or 0.07 percent, after hitting a low of 28,579.49 earlier. Japanese shares ended notably lower on Wednesday.

Market heavyweight SoftBank Group is edging down 0.3 percent and Uniqlo operator Fast Retailing is edging down 0.4 percent. Among automakers, Toyota is flat and Honda is edging down 0.4 percent. In the tech space, Advantest is edging up 0.3 percent, while Tokyo Electron and Screen Holdings are adding almost 1 percent each. In the banking sector, Mitsubishi UFJ Financial is edging up 0.1 percent and Sumitomo Mitsui Financial is flat, while Mizuho Financial is edging up 0.2 percent.

The major exporters are lower. Panasonic is edging down 0.4 percent and Sony is edging down 0.2 percent, while Mitsubishi Electric and Canon are losing almost 1 percent each.

Among the other major losers, Nintendo and Sumitomo Osaka Cement are losing almost 2 percent each.

Conversely, Z Holdings is gaining almost 6 percent. In the currency market, the U.S. dollar is trading in the 115 yen-range on Thursday.

Elsewhere in Asia, South Korea, Indonesia, Malaysia, and Singapore are lower by between 0.1 and 0.3 percent each, while China, Hong Kong and New Zealand are higher by between 0.4 and 0.7 percent each. Taiwan is relatively flat. On Wall Street, stocks turned in another mixed performance during trading on Wednesday After ending the previous session on opposite sides of the unchanged line. Despite the choppy trading, the Dow and the S&P 500 reached new record closing highs.

The Dow rose 90.42 points or 0.3 percent to 36,488.63, closing high for the sixth consecutive session. The S&P 500 also inched up 6.71 points or 0.1 percent to 4,793.06, while the Nasdaq climbed well off its worst levels but still closed down 15.51 points or 0.1 percent at 15,766.22.

The major European markets also finished the day mixed. While the U.K.’s FTSE 100 Index advanced by 0.7 percent, the French CAC 40 Index dipped by 0.3 percent and the German DAX Index fell by 0.7 percent.

Crude oil prices moved higher Wednesday, extending recent gains after the Energy Information Administration said U.S. crude oil inventories fell more than expected last week. Crude oil for February delivery climbed $0.58 or 0.8 percent to $76.56 a barrel.

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South Korean Industrial Production Surprises To The Upside

Industrial output in South Korea advanced a seasonally adjusted 5.1 percent on month in November, Statistics Korea said on Thursday.

That easily beat expectations for an increase or 2.5 percent following the upwardly revised 2.9 percent contraction in October (originally -3.0 percent).

On a yearly basis, industrial production advanced 5.9 percent – again exceeding forecasts for 3.2 percent and accelerating from 4.5 percent in the previous month.

The index of all industry production was up 3/2 percent on month and 5.3 percent on year in November.

The Manufacturing Production Index gained 5.3 percent on month and 6.2 percent on year, while the Manufacturing Shipment Index rose 5.1 percent on month and 3.1 percent on year. The Manufacturing Inventory Index eased 0.2 percent on month but jumped 8.8 percent on year.

The Production Capacity Index rose 0.1 percent on month and 0.6 percent on year. The Index of Capacity Utilization Rate gained 5.5 percent on month and 3.9 percent on year. The Manufacturing Average Capacity Utilization Rate in November was 75.1 percent, up 4.0 percentage points from the previous month.

The Index of Services in November increased by 2.0 percent on month and 5.3 percent on year. The Retail Sales Index sank 1.9 percent on month but improved 4.6 percent on year. The Equipment Investment Index spiked 10.9 percent on month and 9.2 percent on year.

The Domestic Machinery Shipment Index in November rose 0.5 percent on year, while the value of Domestic Machinery Orders Received soared 25.0 percent on year.

The value of Construction Completed at constant prices added 2.4 percent on month but fell 5.6 percent on year. The value of Construction Orders Received at current prices tumbled 12.5 percent on year.

The Composite Coincident Index added 0.5 percent on month, while the Cyclical Component of Composite Coincident Index, which reflects current economic situations, increased by 0.4 points from the previous month.

The Composite Leading Index in November showed no change from the previous month. The Cyclical Component of Composite Leading Index, which predicts the turning point in business cycle, decreased by 0.4 points from the previous month.

Also on Thursday, Statistics Korea said that the total value of retail sales was down a seasonally adjusted 1.9 percent on month in November. That missed forecasts for a decline of 1.0 percent following the 0.2 percent increase in October.

On a yearly basis, retail sales climbed 4.6 percent – shy of expectations for a gain of 5 percent and was down from the 7.4 percent increase in the previous month.

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Asian Shares Mixed After Dip In US Markets

Asian stocks ended on a mixed note Wednesday after U.S. stocks ended mostly lower overnight amid profit taking following recent gains on hopes the global economic recovery can weather risks from the Omicron virus variant and tightening monetary policy.

Chinese shares fell in cautious trade as a lockdown of 13 million people in the Chinese city of Xian entered its seventh day. The Shanghai Composite index fell 33.11 points, or 0.91 percent, to 3,597, dragged down by consumer staple and bank stocks.

Hong Kong’s Hang Seng index ended down 194.02 points, or 0.83 percent, at 23,086.54. Japanese stocks closed lower in thin year-end trade as investors braced for a feared rebound in coronavirus cases at the start of New Year’s holidays.

The Nikkei average dropped 162.28 points, or 0.56 percent, to 28,906.88, with transportation equipment, retail and communication sectors in focus. The broader Topix index closed 0.30 percent lower at 1,998.99.

J. Front Retailing soared 7.4 percent and Tokyo Electric Power rallied 3.5 percent while Bridgestone, AGC and Sapporo Holdings lost 3-4 percent.

Australian markets rose for a fifth straight session to close at a 3-1/2 month high despite the country’s Covid-19 infections surging to a fresh record due to the rapid spread of the Omicron variant.

The benchmark S&P/ASX 200 index climbed 89.50 points, or 1.21 percent, to 7,509.80 while the broader All Ordinaries index jumped 95.60 points, or 1.23 percent, to close at 7,840.30.

Buying was seen across the board, with financials and energy stocks leading the surge. Mining heavyweights BHP and Rio Tinto ended on a flat note despite copper prices hitting a one-month high.

Chalice Mining soared 7.8 percent after the platinum explorer said it was closer to begin drilling at its Julimar project in Western Australia.

Seoul stocks ended notably lower due to ex-dividend trades and profit-taking after recent string of gains. The Kospi average fell 26.95 points, or 0.89 percent, to 2,993.29 amid selling by institutional and foreign investors. Tech and auto stocks were among the prominent decliners.

In economic releases, sentiment among South Korean businesses over the economic situation improved this month due to export growth, central bank data showed.

New Zealand shares eked out modest gains, with the benchmark NZX-50 index rising 52.01 points, or 0.40 percent, to 12,940.42 in post-Christmas trade.

Financial services provider Heartland Group Holdings surged 4.7 percent and pharmaceutical firm EBOS added 3.5 percent.

Overnight, the Dow edged up 0.3 percent to extend gains for the fifth straight day while the Nasdaq Composite fell 0.6 percent and the S&P 500 slid 0.1 percent to snap a four-day winning streak.

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Japan’s Industrial Production Spikes 7.2% In November

Industrial output in Japan advanced a seasonally adjusted 7.2 percent on month in November, the Ministry of Economy, Trade and Industry said on Tuesday.

That beat expectations for an increase of 4.8 percent and was up from the 1.8 percent gain in October.

On a yearly basis, industrial production improved 5.4 percent – again topping forecasts for a gain of 2.5 percent following the 4.1 percent contraction in the previous month.

Upon the release of the data, the METI upgraded its assessment of industrial production, saying that it now showing signs of an upward movement.

Industries that contributed to the increase included motor vehicles, plastic products and iron and steel. These gains were offset by declines in production among chemicals and petroleum products.

Shipments were up 7.4 percent on month and 3.5 percent on year, while inventories rose 1.7 percent on month and 5.2 percent on year. The inventory ratio slipped 2.6 percent on month and rose 0.4 percent on year.

According to the METI’s forecast for industrial production, output is expected to rise 1.6 percent in December and 5.0 percent in January.

Industries contributing to the increase in December include transport equipment and fabricated metals; January’s gains are expected to be supported by production machinery, electrical machinery and electronic parts.

Also on Tuesday, the Ministry of Internal Affairs and Communications said that the unemployment rate in Japan came in at a seasonally adjusted 2.8 percent in November.

That missed expectations for 2.7 percent, which would have been unchanged from the October reading.

The jobs-to-applications ratio was 1.15, unchanged from the previous month but shy of expectations for 1.16.

The participation rate was 62.0 – unchanged and in line with forecasts.

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Asian Shares Follow Wall Street Higher

Asian stocks ended mostly higher on Tuesday after strong retail sales data helped Wall Street’s S&P 500 index end at a record high in its fourth straight day of gains overnight. Traders also evaluated the resilience of the global recovery to a record spike in coronavirus cases.

Chinese shares eked out modest gains as authorities unveiled sweeping regulations governing overseas share sales by the country’s firms and the People’s Bank of China injected 200 billion yuan ($31.39 billion) through seven-day reverse repos into the banking system.

The benchmark Shanghai Composite index edged up 14.14 points, or 0.39 percent, to 3,630.11 while Hong Kong’s Hang Seng index ended up 0.24 percent at 23,280.56.

China Evergrande Group shares jumped more than 8 percent after the embattled property developer said it had made initial progress in resuming construction work.

Japanese shares hit a one-month high, led by gains in technology stocks. Sentiment was also bolstered by data showing a Japan’s factory output in November.

The Nikkei index rallied as much as 392.70 points, or 1.37 percent, to 29,069.16, marking its highest since Nov. 25. The broader Topix index closed 1.37 percent higher at 2,005.02.

Tokyo Electron, Sony Group, Fanuc and Daikin Industries jumped 2-3 percent. Medical equipment and camera maker Olympus soared as much as 4.3 percent.

Kewpie added 2.6 percent after the mayonnaise maker raised its forecast for annual profit and dividend.

Seoul stocks advanced as investors bought shares before the ex-dividend date. The Kospi average gained 20.74 points, or 0.69 percent, to finish at 3,020.24. LG Chem, SK Hynix and Naver all rose about 1 percent.

Investors shrugged off data from the Bank of Korea showing that consumer confidence in the country weakened for the first time in four months in December.

U.S. stocks rose in thin post-Christmas trading overnight as investors hailed strong holiday season sales and grew confident a global recovery would regain steam next year despite the challenges posed by the Covid-19 pandemic.

The S&P 500 climbed 1.4 percent to reach a new record closing high ahead of year-end window dressing and the tech-heavy Nasdaq Composite rallied 1.4 percent while the Dow added 1 percent.

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Asian Shares Edge Lower In Quiet Trade

Asian stocks were mostly lower in thin holiday trade on Monday amid nervousness around the spread of the Omicron coronavirus variant.

Airlines across the world cancelled just under 8,000 flights over the three-day Christmas weekend due to the spread of the Omicron variant, flight delays and cancellations related to staff shortages.

Many regional markets including Australia, Hong Kong and New Zealand were closed for holidays.

Chinese shares fluctuated before finishing marginally lower for the day after official data showed profits at China’s industrial firms grew at a much slower pace in November.

The downside was capped after the People’s Bank of China pledged greater support for the real economy, and said it will make monetary policy more forward-looking and targeted.

Japan’s Nikkei index slipped 0.37 percent to end at 28,676.46 after China reported its highest daily rise in local Covid-19 cases in 21 months over the weekend, pushing regions into lockdowns and tighter social restrictions.

Global technology investor SoftBank Group lost about 3 percent on news that Credit Suisse may seek legal information against the Japanese company to recover certain funds.

Chip-related stocks such as Tokyo Electron and Advantest gained 2.1 percent and 0.8 percent respectively.

Uniqlo clothing shop operator Fast Retailing declined 1.8 percent after new cases of community transmission of the Omicron variant spread major cities. South Korea’s Kospi average dropped 0.43 percent to 2,999.55 due to year-end profit taking. SK Hynix gave up 1.6 percent and Naver shed 0.9 percent while LG Chem rose 1 percent.

India’s Sensex was up 0.3 percent in choppy trade. Gold held steady above the key level of $1,800 per ounce in Asian trade, as slightly weaker U.S. Treasury yields countered an uptick in the dollar. Oil edged lower on concerns over the outlook for fuel demand.