Asian markets mixed on Chinese data
Investors relieved after retail sales and industrial output for June better than expected, even as Q2 economic growth slows to 6.2%
The deluge of Chinese data releases yesterday was keenly watched as indicators of the impact of May's re-escalation of trade tension with the US on China's economy.
That the figures either met or beat expectations saw investors relieved for the most part but contributed to a mixed session across Asia.
Singapore's Straits Times Index (STI) dropped 9.39 points or 0.3 per cent to close at 3,347.95 yesterday after spending most of the session hovering around Friday's closing.
Among markets in the Asia-Pacific, China and Hong Kong closed higher while Australia, Malaysia and South Korea finished in negative territory. Japan markets were closed yesterday for Marine Day and will resume trading today.
Sentiment has been choppy to say the least, with worries over US-China trade relations and the global economic slowdown a constant play on investors' minds.
The effect of which, as Vanguard markets managing partner Stephen Innes put it, has meant that "every time we are faced with a major economic number, it comes as a huge sigh of relief even when the print comes out as expected".
Yesterday, China's gross domestic product (GDP) decelerated to 6.2 per cent in the second quarter from the same period a year ago, despite Beijing's stimulus efforts.
Mr Tom Rafferty, the Economist Intelligence Unit's China principal economist, said: "With GDP growth dipping towards the government's 6 per cent floor, government policy will remain pro-growth over the remainder of this year and into 2020. This will make subsequent policy tightening all the more challenging."
But Mr Rafferty added that there were bright spots from yesterday's data dump where China's consumer sector saw "retail sales (in June) helped by the recovery of car sales from a one-year period of contraction".
June industrial output also beat expectations.
In Singapore, trading volume clocked in at 1.37 billion securities, 15 per cent over the daily average in the first six months of this year. Total turnover came to $875.59 million, 82 per cent of the January-to-June daily average.
Across the broader market, decliners beat advancers 217 to 200. The benchmark index had 14 of the STI's 30 components closing in the red.
Thai Beverage, down two cents or 2.3 per cent lower to 84.5 cents, was the benchmark index's most traded stock with 34.6 million shares changing hands. The food and beverage player's shares saw heavier-than-usual trading after news reports emerged that Anheuser-Busch InBev (AB InBev) had cancelled the listing of its Asia-Pacific unit in Hong Kong, with market watchers saying that AB InBev priced the listing too high.
"If AB InBev's Asia-Pacific does end up pulling through to list in the region, it may act as a re-rating catalyst for ThaiBev," a trader told The Business Times.
The local banks returned from the weekend higher. DBS Group Holdings was $0.12 or 0.5 per cent higher at $25.90, OCBC Bank edged up $0.01 or 0.1 per cent to $11.52 and United Overseas Bank finished at $26.56, up $0.03 or 0.1 per cent.
IG market strategist Pan Jingyi noted that DBS, which has a sizeable exposure to the Chinese market, saw its counter performance pick up in the late session after the better-than-expected industrial and retail data in China were released.
In the session after releasing its third-quarter results, shares in Singapore Press Holdings fell $0.17 or 6.8 per cent lower to $2.32.
On Friday after market close, the media and property group posted a 44.1 per cent drop in net profit to $26.2 million for the period ended May 31, despite a marginal decline in operating revenue.
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