Talking Points:
- Asian stocks were mixed into Friday’s close
- US tax reform was in focus as was China’s private manufacturing sector
- The US Dollar had a steady session
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It was yet another mixed session for Asia Pacific stocks Friday, despite a strong Wall Street session which saw the Dow Jones Industrial Average close above 24,000 for the first time.
US tax reform was in focus yet again. Senate Republicans delayed a vote on their version of the bill only hours before it was supposed to be finalised. Stocks got a modest boost earlier following Senator John McCain’s change of heart when he said he would support the bill and there remains some hope that it could pass Friday.
The Nikkei 225 ended up 0.4%, possibly helped by a steadier USD/JPY rate. The ASX 200 was up 0.3%. It did briefly rise back above the 6,000 level in Friday’s trade but couldn’t hold that ground into the close. Chinese stocks fell back, but not by much. On the local data front, Japanese consumer prices came in broadly as expected. The headline annualised rate fell back to just 0.2% in October, but the core- omitting food prices- rose to 0.8%. This remains well shy of the Bank of Japan’s 2% target, however. That has not been hit for more than two years.
China’s private-sector Caixin Purchasing Managers Index was rather weaker than its official counterpart. However expansion continues and markets took scant notice even though, at 50.8, it turned in its weakest print since July.
There wasn’t a huge amount of foreign exchange action in Asia with the US Dollar broadly unchanged against a basket of its major traded rivals. Gold prices held near three-week lows with investors apparently happy to hold risker assets. Oil prices rose on news that OPEC and other major producers would extend their production cuts.
The Asian week may be all-but over but there’s plenty of life left in Friday around the world. From the US investors can look forward to the Institute for Supply Management’s manufacturing and employment surveys along with the construction spending snapshot. Before all that will come official Canadian Gross Domestic Product and employment figures. The Italian GDP release is also due.
--- Written by David Cottle, DailyFX Research
Contact and follow David on Twitter: @DavidCottleFX
