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Asian markets shift focus from global risk to results

Thursday 03.00 BST

What you need to know

  • Hong Kong equities boosted by Tencent, Cathay Pacific rally
  • Oil prices steady after another drop on Wednesday
  • Dollar weakens further against regional currencies

Overview

Stock markets in Asia were mixed on Thursday as Hong Kong rallied and Tokyo struggled to climb into positive territory. Oil pulled back from a marked drop in the previous session, while the dollar edged lower against regional currencies.

Hot topic

Asia Pacific equities were faring better than those on Wall Street, where the S&P 500 closed Wednesday up only 0.1 per cent on increased uncertainty over US President Donald Trump’s pro-business agenda after both of his corporate advisory groups collapsed.

Hong Kong stocks were help by Tencent, which climbed as much as 5.5 per cent after the Chinese tech conglomerate reported quarterly operating profits well above expectations. Shares in Cathay Pacific climbed as much as 6.2 per cent despite disappointing first-half results. The benchmark Hang Seng index, in which Tencent is weighted heavily, was up 0.5 per cent.

In Sydney financials were 0.7 per cent lower, led by a 3.9 per cent fall for QBE Insurance Group on news the company planned to split its emerging markets division in two to improve performance after a disappointing first half. Telecoms provider Telstra fell as much 12 per cent after it announced a fall in full-year profit and cut its dividend outlook. The S&P/ASX 200 index was up 0.3 per cent.

Tokyo-listed equities were struggling to find a direction despite better than expected export figures for July, as the Topix shed 0.1 per cent. A fall of 0.7 per cent for financials largely offset gains elsewhere.

Forex and fixed income

Forex moves were settling down on Thursday following volatility earlier in the week. The yen pushed back below the ¥110 mark on Thursday, firming 0.4 per cent to ¥109.79 per dollar.

The Australian dollar was wavering after early gains, up 0.2 per cent on the greenback to $0.7937 after Australian employment data released on Thursday showed an unexpected fall in full-time employment numbers as part-time workers grew.

Australian government bonds were on the rise, driving yield on the 10-year note down 3 basis points to 2.629 per cent. The dollar index measuring the greenback against a basket of peers was off 0.2 per cent at 93.36.

Yield on the 10-year US Treasury was up 1bp at 2.228 per cent after falling 5bp on Wednesday amid heightened uncertainty over the outlook for US businesses following the collapse of Mr Trump’s business advisory groups.

Commodities

Oil prices were recovering from 1 per cent-plus drops seen Wednesday for both major benchmarks.

International benchmark Brent crude was up 0.3 per cent at $50.43 a barrel after finishing Wednesday 1 per cent lower. Thursday’s level marked a 2.6 per cent fall since the end of July. West Texas Intermediate, the US marker, was up 0.2 per cent at $46.88 after ending the previous session down 1.6 per cent. It was down 4.6 per cent in the month to date.

Gold built on a climb of nearly 1 per cent overnight, spurred by the dissolution of Donald Trump’s business advisory councils. The haven rose 0.4 per cent in Asia trading to $1,288.78 per ounce.

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