September producer prices in China unexpectedly rose for the first time in nearly five years, while consumer inflation also beat expectations, setting the tone for equity markets globally. China's inflation data released yesterday showed producer and consumer prices rose, with the Producer Price Index a gauge of factory-gate inflation turning positive for the first time in nearly five years. This positive reading meant that companies might see a rise in their profits. Consumer prices rose 1.9% year on year in September, while producer prices added 0.1%, the first increase since March 2012, the National Bureau of Statistics said on Friday.
The rebound in the U.S. retail sales and a rise in producer prices last month indicating the economy regained momentum in the third quarter after a lackluster first-half and bolstered expectations the Federal Reserve would raise interest rates in December. U.S. producer prices rose in September to post their biggest year-on-year rise since December 2014, while retail sales gained 0.6% after a 0.2% decline in August.
Among Asian bourses
Australia Market closed steady
Australian share market closed mixed after a choppy session, with weakness in materials and resources and financial blue-chip stocks offset gains in utilities, industrial and consumer goods stocks. At the closing bell, the benchmark S&P/ASX 200 index declined 1.50 points to 5,434, while the broader All Ordinaries index was up 0.20 point to 5,518.50. Falling stocks outnumbered advancing ones on the Australia Stock Exchange by 533 to 498 and 315 ended unchanged. The S&P/ASX 200 VIX, which measures the implied volatility of S&P/ASX 200 options, was down 5.34% to 14.125.
Shares of materials and resources tumbled on tracking weakness in commodity metal prices. Among the miners, BHP shed 0.9% to A$22.52, Rio Tinto sank 1% to A$51.05, and Fortescue Metals shed 0.4% to A$4.88. Gold producer Newcrest Mining de-grew 2% to A$21.01.
Shares of energy companies were under pressure after Credit Suisse cautioned valuations for the big oil and gas companies appear stretched, and said it was lowering its stance on both Oil Search and Santos to "underperform" from "neutral." Woodside Petroleum edged up 0.2% to A$29.54 but Oil Search fell 1% to A$7.16 and Santos eased 0.3% to A$3.71.
Financial stocks were down on concerns about falling margins, rising loan losses and an ongoing need to build capital to meet regulatory requirements. Westpac erased 0.5% to A$30.24, meanwhile NAB declined 0.6% to A$27.76 and ANZ dipped 0.9% to A$27.53. Commonwealth Bank rose 0.1% to A$74.58.
Japan Market bounces on yen easing
The Japan share market gained ground, as risk appetite buying underpinned on the back of yen depreciation against greenback. However, market topside capped due to a steep fall in Chinese exports in September, released the previous day. The 225-issue Nikkei average gained 82.13 points, or 0.49%, to close at 16,856.37. The Topix index of all first-section issues ended up 4.88 points, or 0.36%, at 1,347.19. Rising issues outnumbered falling ones 1,100 to 749 in the TSE's first section, while 136 issues were unchanged. Volume fell slightly to about 1.63 billion shares from Thursday's about 1.66 billion shares.
Japanese stocks opened lower as the yen's recent weakening eased amid continuing worries about China's pace of economic expansion. Caution also persisted over Japanese corporate earnings results to be released in the coming weeks. Yet, several individual stocks helped push the index into positive territory.
Oil companies Japex, Inpex and JX Holdings attracted buying thanks to higher crude oil prices. Mobile phone carrier SoftBank Group, heavily weighted components of the Nikkei average, was also buoyant.
Clothing retailer and Uniqlo store-operator Fast Retailing Co. rose on hopes for a V-shaped recovery for the firm in the new fiscal year, after the company released its results for the 12 months ended Aug. 31. Electronics and information technology firm Fujitsu gained 2.2% on hopes it will be focusing on its core business.
Electronics giant Sony briefly hit this year's high on a wave of buying sparked by news that Bob Dylan won the 2016 Nobel Prize in Literature. Other major winners included automakers Toyota, Suzuki and Honda, telecommunications firm NTT, mobile phone carrier KDDI and industrial robot maker Fanuc.
China Stocks gain momentum from inflation data
Mainland China stock market finished the session higher after recouping early losses, as stronger-than-expected Chinese inflation data eased some concerns about the health of the world's second-biggest economy. Total 6 out of 10 SSE sectors advanced, with telecom issue being major gainer, followed by industrial and energy issue, while information techno logy and materials issues being major losers. The CSI300 index of the largest listed companies in Shanghai and Shenzhen added 0.1%, to 3,305.85 points, while the Shanghai Composite Index inclined 0.08% to 3063.81 points.
China's crude imports rose to a record as a new strategic reserve site became operational and refineries prepare to process more oil. The world's biggest energy user imported 33.06 million metric tons of crude in September, according to data released by the General Administration of Customs on Thursday. That's about 8.08 million barrels a day. China received two crude cargoes last month to help fill the second phase of Zhoushan emergency reserve facility on Aoshan island, according to ICIS China, a Shanghai-based commodity researcher. The nation's oil processing in the fourth quarter will climb more than 5 percent from the previous period as refineries resume operations after seasonal maintenance.
The China Securities Regulatory Commission (CSRC) approved the IPO applications of 14 companies. The firms will be allowed to raise a maximum total of 7.3 billion yuan (US$1.08 billion), a statement said on Friday. Seven of the firms will be listed on the Shanghai bourse, two on the Shenzhen bourse's Small and Medium-sized Enterprise board, and five on the ChiNext, China's NASDAQ-style board of growth enterprises. The CSRC has given the greenlight to IPO applications for 163 firms this year, putting the total funds raised at 113.2 billion yuan.
Hong Kong Stocks up in quite trade
The Hong Kong stock market closed higher in quiet trade, due to bottom fishing in recently battered stocks, thanks to stronger-than-expected Chinese inflation data and the possibility of a U.S. interest rate hike later in the year.The Hang Seng Index rebounded 0.88% or 202.01 points to 23,233.31, while the Hang Seng China Enterprises Index climbed up 1.1% or 104.55 points to 9,601.40. Turnover decreased to HK$60.3 billion from HK$74.5 billion on Thursday.
Energy players bumped up on tracking strength in crude oil prices. Brent oil future prices rose 0.4%, while NYMEX oil future prices also edged up 0.5% as US oil and gas inventory reduced last week. CNOOC (00883) put on 3% to HK$10.44. Sinopec (00386) gained 1% to HK$5.72.
CK Property (01113) put on 1% to HK$55.05. Moody's has upgraded the developer's issuer rating to A2 from A3, reflecting its strong financial profile. Swire (00019) and K Wah (00173) also gained 1% to HK$83.1 and HK$4.18.
Indian market settles higher
Indian benchmark indices ended the volatile trading session with small gains, led by software firm Tata Consultancy Services after upbeat quarterly profit. The barometer index, the S&P BSE Sensex, rose 30.49 points or 0.11% to settle at 27,673.60. The Nifty 50 index rose 10.05 points or 0.12% to settle at 8,583.40. The all-India general CPI inflation dipped to 13-months low of 4.31% in September 2016, compared with 5.05% in August 2016. The core CPI inflation moved up to 4.77% in September 2016 from 4.59% in August 2016. The data was announced after market hours yesterday, 13 October 2016. Meanwhile, data released by the government during market hours today, 14 October 2016, showed that the annual rate of inflation, based on monthly wholesale price index (WPI), stood at 3.57% (provisional) in September 2016 compared to 3.74% (provisional) in August 2016 and minus 4.59% in September 2015.
Elsewhere in the Asia Pacific region: New Zealand's NZX50 added 0.2% to 7133.26. Indonesia's Jakarta Composite index grew 1.1% to 5399.88. Taiwan's Taiex shed 0.6% to 9165.17. South Korea's KOSPI index rose 0.4% to 2022.66. Malaysia's KLCI was down 0.4% at 1659. Singapore's Straits Times index added 0.4% to 2815.24.
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