Asian Stocks Down Over Mixed Chinese Inflation Data

Stock Markets2 hours ago (Jun 08, 2021 10:31PM ET)

(C) Reuters.

By Gina Lee – Asia Pacific stocks were mostly down Wednesday morning but moves remained small. Investors digested mixed inflation data from China while awaiting the same data from the U.S later in the week.

The benchmark 10-year U.S. Treasury yield steadied from a fall to an intraday one-month low. Yields eased for a third consecutive week.

China’s Shanghai Composite edged up 0.13% by 10:22 PM ET (2:22 AM GMT) while the Shenzhen Component was down 0.29%. The Chinese consumer price index (CPI) for May, released earlier in the day, missed forecasts, contracting 0.2% month-on-month and growing 1.3% year-on-year. However, the producer price index (PPI) exceeded expectations, growing 9% year-on-year.

U.S.-China relations are also back in the spotlight as the U.S. Senate passed a bill to counter the economic as well as strategic challenge from China. The U.S. Innovation and Competition Act of 2021 bill to invest almost $250 billion in bolstering U.S. manufacturing and technology passed on Tuesday by a 68-32 vote.

Although the bill’s passage was a rare show of bipartisanship in a chamber that remains divided on other issues, it remains to be seen if the House of Representatives will also pass the bill.

Hong Kong’s Hang Seng Index inched up 0.01%.

South Korea’s KOSPI was down 0.21%. The country’s GDP grew 1.7% quarter-on-quarter in the first quarter of 2021, exceeding both the 1.6% growth in forecasts prepared by and the previous quarter’s 1.2% growth.

Japan’s Nikkei 225 was down 0.25% and In Australia, the ASX 200 inched down 0.09%.

On the data front, the U.S. will release its consumer price report, including the CPI, for May on Thursday. The report is expected to affect perceptions of when the U.S. Federal Reserve will start tapering its asset purchases ahead of its policy meeting scheduled for the following week.

As investors await the data, debate continues on whether inflation will prove to be more long-term and prompt central banks to withdraw unprecedented stimulus measures earlier than expected.

However, some investors remained assured by the Fed’s continuous assurances that inflation will prove temporary. Global shares continue to remain near a record high despite the volatility remaining in sectors such as cryptocurrencies.

“The tight trading ranges seen so far this month reflect the cautious mood in the market ahead of the inflation numbers,” City Index senior financial markets analyst Fiona Cincotta told Bloomberg.

“Whilst the Fed reassures that this spike in inflation is temporary, policymakers will need to be out in their droves to calm the market,” Cincotta added.

Investors also await the European Central Bank’s policy decision due to be handed down on Thursday. The U.K.’s Cornwall will also host the Group of Seven (G7) leaders’ summit, due to open on Friday.

Asian Stocks Down Over Mixed Chinese Inflation Data

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Related Stories


Fraud protection startup nSure AI raises $6.8M in seed...

Fraud protection startup nSure AI has raised $6.8 million in seed funding, led by DisruptiveAI,...

Commsor buys Meetsy to build community tools for all

Mac Reddin, the co-founder and CEO of Commsor, met the first professional investor for...

How one founder is bringing the global corporate security...

When Cory Siskind finished school, she was dropped into a high-stakes job helping large...

Popular Categories