(Bloomberg) — Asian shares traded within a narrow range Monday as investors weighed a series of data that reinforced concerns about the health of China’s economy.
Most read from Bloomberg
South Korean shares eked out gains, while Australian shares fell and futures pointed to a lower start in Hong Kong. Spot trading in US government bonds was closed in Asia due to a holiday in Japan. The yen fell after Kazuo Ueda, governor of the Bank of Japan, indicated on Friday that authorities are in no hurry to raise interest rates again.
The Chinese economy shows few signs of recovery. Data from last week showed governments have cut spending, while youth unemployment rose to its highest level this year as the country’s banks refrained from cutting interest rates. Adding to the weak sentiment, the US is planning rules starting Monday that would ban Chinese hardware and software for connected vehicles.
“Things in China are going from bad to worse,” said Tony Sycamore, an analyst at IG in Sydney. “With Japanese stock markets closed for a holiday, the PBOC disappointing the market on Friday and US yields soaring, we are likely to see a gloomier tone in Asian stock markets today.”
The dollar was little changed against its Group of 10 peers early Monday. Australian bonds fell ahead of the central bank’s likely extension of a policy pause on Tuesday as housing costs support stubborn inflation.
Overall, markets are preparing for the final quarter after the Federal Reserve began its long-awaited rate cutting cycle last week, lifting everything from Indonesian bonds to gold. Data this week, including the Fed’s preferred inflation measure, should confirm whether the rally will continue, with a deterioration likely to boost the chances of a further 50 basis point cut.
Brent crude rose, highlighting an escalation of the conflict between Israel and Hezbollah. Gold remained close to a record.
In Asia, Sri Lankans elected a left-wing political outsider as president this weekend, who promised to reopen negotiations with the International Monetary Fund over the $3 billion bailout that included spending cuts and tax hikes.
Elsewhere this week, business activity and consumer confidence are expected in Europe, while Australia and Tokyo are due to release inflation data. A slew of Fed speakers will appear soon as economic data, including US personal consumption spending and unemployment figures, are set to be released.
Main events this week:
-
Malaysia CPI, Monday
-
Eurozone HCOB Manufacturing PMI, HCOB Services PMI, Monday
-
UK S&P Global Manufacturing PMI, S&P Global Services PMI, Monday
-
Tariff decision Australia, Tuesday
-
Japan Jibun Bank Manufacturing PMI, Services PMI, Tuesday
-
CPI Mexico, Tuesday
-
Bank of Canada Governor Tiff Macklem speaks Tuesday
-
Australia CPI, Wednesday
-
Interest rates on Chinese medium-term loans, Wednesday
-
Tariff decision Sweden, Wednesday
-
Tariff decision Switzerland, Thursday
-
ECB President Christine Lagarde speaks on Thursday
-
US unemployment claims, durable goods, revised GDP, Thursday
-
Fed Chairman Jerome Powell delivers pre-recorded remarks at the 10th annual US Treasury Market Conference, Thursday
-
Tariff decision Mexico, Thursday
-
Japan Tokyo CPI, Friday
-
Industrial gains in China, Friday
-
Consumer confidence in the eurozone, Friday
-
U.S. PCE, University of Michigan Consumer Confidence, Friday
Some of the major moves in the markets:
Stocks
-
S&P 500 futures rose 0.1% as of 9:04 a.m. Tokyo time
-
Hang Seng futures fell 0.5%
-
Australia’s S&P/ASX 200 fell 0.4%
-
Euro Stoxx 50 futures fell 1.4%
Currencies
-
The Bloomberg Dollar Spot Index was little changed
-
The euro was little changed at $1.1160
-
The Japanese yen fell 0.2% to 144.11 per dollar
-
The offshore yuan was little changed at 7.0464 per dollar
Cryptocurrencies
-
Bitcoin rose 0.4% to $63,461.17
-
Ether rose 0.2% to $2,578.54
Bonds
Raw materials
This story was produced with the help of Bloomberg Automation.
Most read from Bloomberg Businessweek
©2024 BloombergLP