Checkout
Cart: $0.00 - (0 items )

Asia equities buoyant after Bank of Japan rates decision

Friday 05:55 BST

Overview

Stocks climbed in Asia on Friday after the Bank of Japan kept monetary policy on hold at its June meeting, while regional currencies largely softened and oil prices hovered near seven-month lows.

Hot topic

Asia Pacific equities rallied on Friday. Tokyo’s Topix index led the region higher with a rise of 0.7 per cent, boosted by gains of 1.7 per cent from telecoms and 1.4 per cent from the financial segment that intensified following the BOJ announcement.

The central bank, which is seeking to avoid speculation about an early exit from stimulus, on Friday held its main policy rate steady at minus 0.1 per cent and stuck to its pledge to keep the yield on 10-year Japanese government bonds around zero. The decisions were expected by economists.

The BOJ retained its upbeat stance, which emerged at its April meeting, and used its policy statement to repeat that Japan’s economy “has been turning toward a moderate expansion” and that this trend was likely to continue.

In Sydney the S&P/ASX 200 was up 0.3 per cent as utilities and real estate stocks both climbed 0.7 per cent. However, shares in miner BHP Billiton dipped as much as 1.1 per cent after the company announced its board had selected Ken MacKenzie — a former chief executive of Amcor — as chairman to replace Jac Nasser from September 1.

Hong Kong’s Hang Seng index was up 0.4 per cent, buoyed by gains of 0.7 per cent from the financials segment and 0.5 per cent by information technology stocks. Shares in Tencent rose as much as 1 per cent on word the company had led a funding round of more than $600m in Chinese bike-sharing company Mobike.

Forex

Asian currencies were largely down on Friday, with the exception of the Australian dollar, up 0.2 per cent at $0.7595.

South Korea’s won was faring badly, however, down 0.8 per cent at Won1,132.69 per dollar. The yen was down 0.2 per cent at ¥111.19 after the Bank of Japan’s decision to keep policy on hold.

Outside the region the pound was firmer, gaining 0.1 per cent on the dollar to $1.2774.

The dollar index measuring the greenback against a basket of peers was up 0.1 per cent at 97.487.

Fixed income

Government bonds were faring poorly, with yield — which moves inversely to price — on 10-year US Treasuries up 1 basis point at 2.172 per cent.

The 10-year Australian government bond was worst off in the region as yield on the note rose 5bp to 2.405 per cent. South Korean 10-year sovereign bonds saw yield up 3bp at 2.138 per cent, while that on the equivalent Japanese government note was up 1bp at 0.048 per cent.

Commodities

Crude prices were little moved in Asia trade after edging lower during the Thursday session. Brent crude, the global benchmark, was flat at $46.93 a barrel, as was US marker West Texas Intermediate at $44.45.

Gold was down 0.1 per cent at $1,253.23 per ounce.

For market updates and comment follow us on Twitter @FTMarkets