Asian Stocks Up, Chinese Data Exceeds Expectations

By Gina Lee

Investing.com – Asia Pacific stocks were mostly up on Friday morning, potentially boosted by better-than-expected Chinese data and a rally in U.S.-listed Chinese equities. Trade was thin, with it being the last trading day of 2021 in some countries.

China’s Shanghai Composite gained 0.52% by 10:03 PM ET (2:03 AM GMT) while the Shenzhen Component was up 0.21%. Data released earlier in the day showed that December’s manufacturing purchasing managers index (PMI) was 50.3, and the non-manufacturing PMI was 52.7. Both figures were above the 50-mark indicating growth.

Investors also continued to monitor China’s property sector, particularly some initial coupon payment deadlines for Kaisa Group Holdings Ltd.'s (HK:1638) dollar bonds.

Hong Kong’s Hang Seng Index jumped 1.94% while in Australia, the ASX 200 fell 0.48%. Both markets will close early, while Japanese and Korean markets are closed all day.

The Nasdaq Golden Dragon China Index soared 9.4% on Thursday, the most since 2008, but is still down more than 40% for 2021.

Global equities are closing out a strong year, mainly due to a U.S. rally while Asia Pacific lagged behind. Bond investors are also nursing losses as central banks move to tighten monetary policy to curb high inflation. How this policy shift and COVID-19 will shape economic reopening are key for the outlook in the new year.

“As we look forward to 2022 the gains are probably going to be more modest than they’ve been in the past year or so” partly given where valuations are now, Glenmede chief investment officer for private wealth Jason Pride told Bloomberg.

But there is reason to be optimistic since “we’re still in the recovery from COVID-19,” he added.

In the U.S., data released on Thursday showed that initial jobless claims unexpectedly fell to 198,000 last week, while the Chicago PMI was a higher-than-expected 63.1 for December.

Meanwhile, U.S. President Joe Biden had a 50-minute conversation with his Russian counterpart, Vladimir Putin on Thursday, ahead of three sets of negotiations on European security in January 2022.

During the call, Biden urged Putin to de-escalate tensions with Ukraine, warning that the U.S. and its allies would “respond decisively” if Russia invades. Russia, for its part, was “happy and satisfied” with the “constructive” conversation in which the two leaders agreed to keep in regular contact during the negotiations.

Get The News You Want

Read market moving news with a personalized feed of stocks you care about.

Get The App