Japan stocks hit by strong yen

China inflation picks up

AFP, HONG KONG: Japanese stocks retreated yesterday on the back of a stronger yen as traders consider the prospect of low US interest rates until the end of the year, while easing Chinese producer inflation offered hope for the world’s number two economy.
Another rise in US equities, which put the S&P 500 within spitting distance of a record high, was not enough to spur regional traders as profit-taking took hold following recent gains. However, analysts said the likelihood of an extended period of monetary easing by central banks should provide support to stocks for some time.
“Expectations for a rate hike in the US have been pushed back... That should be supportive of equities,” James Woods, a Sydney-based analyst at Rivkin Securities, told Bloomberg News. “However, a delay in the (Federal Reserve) rate hike is strengthening the yen, providing a headwind for Japan.”
The dollar fell to 106.53 yen Thursday from 106.99 yen in New York, which sent the Nikkei falling one per cent.
The chances of a Fed rate hike in the summer were crushed on Friday by data showing the US economy added a quarter of the jobs expected in May. The central bank meets next week but dealers do not forecast a rise until September at the earliest.
South Korea’s won managed to edge up 0.1 against the greenback despite a surprise cut in the country’s interest rate to a record low, while the New Zealand dollar rallied almost two per cent to a 2016 high after its central bank decided against another reduction.
Oil extends gains
Seoul stocks eased 0.2 per cent and Wellington was down 0.3 per cent. Hong Kong, Shanghai and Taipei were closed for public holidays. Early European trade saw London fall 0.4 per cent while Frankfurt and Paris each slipped 0.3 per cent.
In China, consumer inflation came in at two per cent for last month, slightly below expectations and slower than April’s rate.
However, the fall in the producer price index—which measures what is paid at factory gates and a pointer to future consumer inflation—eased again, fuelling hopes of a slowdown in the world’s number two economy is bottoming.

 

Japan stocks hit by strong yen

China inflation picks up

AFP, HONG KONG: Japanese stocks retreated yesterday on the back of a stronger yen as traders consider the prospect of low US interest rates until the end of the year, while easing Chinese producer inflation offered hope for the worlds number two economy. Another rise in US equities, which put the SP 500 within spitting distance of a record high, was not enough to spur regional traders as profit-taking took hold following recent gains. However, analysts said the likelihood of an extended period of monetary easing by central banks should provide support to stocks for some time. Expectations for a rate hike in the US have been pushed back... That should be supportive of equities, James Woods, a Sydney-based analyst at Rivkin Securities, told Bloomberg News. However, a delay in the (Federal Reserve) rate hike is strengthening the yen, providing a headwind for Japan. The dollar fell to 106.53 yen Thursday from 106.99 yen in New York, which sent the Nikkei falling one per cent. The chances of a Fed rate hike in the summer were crushed on Friday by data showing the US economy added a quarter of the jobs expected in May. The central bank meets next week but dealers do not forecast a rise until September at the earliest. South Koreas won managed to edge up 0.1 against the greenback despite a surprise cut in the countrys interest rate to a record low, while the New Zealand dollar rallied almost two per cent to a 2016 high after its central bank decided against another reduction. Oil extends gains Seoul stocks eased 0.2 per cent and Wellington was down 0.3 per cent. Hong Kong, Shanghai and Taipei were closed for public holidays. Early European trade saw London fall 0.4 per cent while Frankfurt and Paris each slipped 0.3 per cent. In China, consumer inflation came in at two per cent for last month, slightly below expectations and slower than Aprils rate. However, the fall in the producer price indexwhich measures what is paid at factory gates and a pointer to future consumer inflationeased again, fuelling hopes of a slowdown in the worlds number two economy is bottoming.