Asian Stocks Close Mixed Despite Good Chinese Factory Activity Data

By Investors Hub

Asian stocks turned in a mixed performance on Monday even as Chinese factory activity data beat forecasts and the White House said nothing has been decided on curbing some U.S. investments in China.

China’s manufacturing sector expanded at the fastest pace since early 2018 in September despite the ongoing trade dispute with the United States, survey data from IHS Markit showed. The Caixin factory Purchasing Managers’ Index rose to 51.4 in September from 50.4 in August.

However, official data from the National Bureau of Statistics revealed that the factory sector continued to contract in September, although the manufacturing PMI climbed to 49.8 from 49.5 a month ago.

Chinese shares fell sharply as uncertainty over the long-running trade war fueled volatility before an important week-long holiday.

As the Communist Party of China prepares to celebrate the 70th anniversary of its rule, pro-democracy protesters and police engaged in running street battles in a march billed as a rally against global totalitarianism in Hong Kong on Sunday. Protestors are hoping to disrupt Beijing’s celebrations on Tuesday with further mass rallies.

The benchmark Shanghai Composite Index tumbled 26.98 points, or 0.9 percent, to 2,905.19, while Hong Kong’s Hang Seng Index rose 137.46 points, or 0.5 percent, to 26,092.27.

Japanese stocks closed lower as the yen rose slightly following reports that the Trump administration is mulling severe new restrictions on investment in China.

The Nikkei 225 Index slid 123.06 points, or 0.6 percent, to finish at 21,755.84 ahead of the Bank of Japan愀 Tankan quarterly business confidence survey due on Tuesday, which will offer a read on the health of the industrial sector. The broader Topix closed 1 percent lower at 1,587.80.

Heavyweight SoftBank Group fell 2.6 percent. Automakers Honda Motor, Nissan and Toyota ended down between 1.5 percent and 2.1 percent.

Sumitomo Chemical Co. dropped 1.6 percent as it agreed to buy the South American operations of Australian agrichemical maker Nufarm.

Australian markets fluctuated before finishing lower amid uncertainty surrounding the U.S.-China trade war. The benchmark S&P/ASX 200 Index dropped 27.80 points, or 0.4 percent, to 6,688.30, while the broader All Ordinaries Index ended the session down 23.50 points, or 0.3 percent, at 6,800.60.

Energy stocks ended mostly lower despite oil prices recovering from a two-week low touched in the previous session. The big four banks fell between 0.4 percent and 0.9 percent ahead of Tuesday’s Reserve Bank of Australia meeting, with markets speculating on the odds of a rate cut.

Meanwhile, agricultural chemicals group Nufarm jumped over 26 percent as it agreed to sell its South American business to Japanese conglomerate Sumitomo Chemical Co. for A$1.18 billion.

Miners ended mixed, with BHP and Fortescue Metals Group finishing modestly lower while Rio Tinto gained 1.2 percent.

Seoul stocks rose notably, with auto and tech stocks rebounding amid institutional buying. The Kospi climbed 13.12 points, or 0.6 percent, to 2,063.05.

Market heavyweight Samsung Electronics rallied 1.3 percent, chipmaker SK Hynix advanced 1 percent and auto parts maker Hyundai Mobis added 1.2 percent.