SINGAPORE — Stocks in Asia-Pacific traded mixed on Friday after a rally on Wall Street. This followed a negative US gross domestic product report, suggesting the Fed may be less aggressive in its tightening cycle.
In Japan, the Nikkei 225 gained 0.32% while the Topix index was roughly flat.
The country’s industrial production jumped 8.9% in June from the previous month, the Ministry of Economy, Trade and Industry announced on Friday. Printing surprised on the upside after falling in May.
The South Korean Kospi rose 0.85% and the Kosdaq 0.9%.
The S&P/ASX 200 in Australia rose 0.78%.
Singapore’s United Overseas Bank reported net profit of 1.1 billion Singapore dollars ($797 million) for the second quarter, up 11% from a year ago.
“Net interest income increased 18% year-over-year, driven by strong margin improvements and healthy loan growth,” the company said in a statement.
Shares of UOB fell 0.32%, against a 0.55% rise in the Straits Times index.
The Thai market is closed for a holiday Friday.
MSCI’s broadest Asia Pacific ex-Japan equity index gained 0.28%.
Greater China Markets
Hong Kong’s Hang Seng Index fell 0.34%. In mainland China, the Shanghai Composite was slightly lower and the Shenzhen component fell 0.26%.
On Thursday, Chinese leaders signaled that Beijing is unlikely to try to stimulate the economy and downplayed the country’s GDP target of “about 5.5%”.
“This suggests that the government is not going to overspend on infrastructure projects to achieve this goal. We think that’s not such a bad thing,” ING said in a Friday note.
“It would give more room for the central government to solve the problem of unfinished construction projects,” the authors added.
Moreover, Beijing seems committed to its zero-Covid policy.
“It seems to us that any change in the zero-Covid policy will only happen when the authorities are satisfied that the mutations are less virulent and the vaccines/drugs have been shown to be more effective,” wrote Betty Wang of ANZ Research, a senior China economist, and Zhaopeng Xing, a senior China strategist.
Major US indices rose at least 1% overnight.
The Dow Jones Industrial Average jumped 332.04 points, or 1%, to 32,529.63. The S&P 500 rose 1.2% to 4,072.43, and the Nasdaq Composite added nearly 1.1% to 12,162.59.
U.S. futures rose further after tech companies like Apple and Amazon reported strong earnings.
These measures came despite reports from the United States Bureau of Economic Analysis GDP fell 0.9% at an annualized rate for the April-June quarter, according to the prior estimate. GDP fell by 1.6% in the first quarter of the year.
Although this is the second consecutive negative GDP report, official statements on whether the United States is in a recession come from the National Bureau of Economic Research. This determination could take months or even longer.
Currencies and oil
The Japanese yen was trading at 134.51 to the dollar, strengthening from earlier in the week. The Australian Dollar is trying to reach the $0.7 level and was last at $0.6995.
Oil futures gained. U.S. crude rose 1.27% to $97.64 a barrel, while Brent crude rose 0.83% to $108.03 a barrel.