TOKYO – Asian stocks traded mixed on Tuesday, with Tokyo’s benchmark index recovering and calming from last week’s slide.
Japan’s benchmark Nikkei 225 index jumped 3.2% in afternoon trading to 36,156.47. S of Australia&OP/ASX 200 rose almost 0.2% to 7,826.80. South Korea’s Kospi was little changed, gaining less than 0.1% to 2,618.36. Hong Kong’s Hang Seng fell less than 0.1% to 17,104.82, while the Shanghai Composite lost 0.4% to 2,846.40.
In Tokyo, there was demand for computer chip issues, with Tokyo Electron rising 6.2%, reflecting the strong performance of technology-related issues on Wall Street.
Investors also appeared encouraged by how the yen’s recently volatile value appeared to be calming. While a cheap yen is a boon for Japan’s top exporters such as Toyota Motor Corp. by increasing the value of overseas profits when translated into yen, a cheap currency gradually diminishes a nation’s purchasing power.
The US dollar rose to 147.66 Japanese yen from 147.17 yen. The euro cost US$1.0939, little changed from US$1.0935.
“Global geopolitical developments, such as tensions in East Asia, ongoing conflicts in Eastern Europe or disruptions in global trade, could have an even greater impact on the dollar’s performance,” said Luca Santos, currency analyst at ACY Securities.
Last week, Japanese stocks suffered their worst drop since the Black Monday crash of 1987. A comment from a senior Bank of Japan official underlining the importance of stability helped calm markets somewhat.
Uncertainty around the world, such as the situation in Ukraine and the Middle East, as well as concerns about China, are increasing concerns that tend to trigger market swings.
Wall Street experienced a quiet trading day on Monday, with the S&The end of the P500 has changed little. The Dow Jones Industrial Average fell 140 points, or 0.4%, and the Nasdaq Composite rose 0.2%.
Investors are keeping an eye on several data points expected later this week, including reports on inflation and U.S. retail sales. The best case scenario would be signs of slowing inflation and strong sales.
This data influences the decisions of global central banks, including the Federal Reserve, which maintained its main interest rate for a maximum of two decades, trying to combat what is known as “stagflation”. The Fed could ease rates, giving the U.S. economy an upward boost, but that also threatens to worsen inflation.
Japan’s central bank, by contrast, is trying to ignite inflation in an economy long stagnant by deflation by gradually raising interest rates after years of zero or negative rates.
Japan’s real gross domestic product, or GDP, for April to June, which measures the value of a nation’s products and services, will be released on Wednesday.
Some analysts say Japan’s economic growth could be relatively robust, given recent data on domestic capital investment.
“In fact, now that energy and consumer goods prices have stabilized, we are seeing the first increase in real wages and real incomes in more than two years in Japan,” said Jesper Koll, a strategist and Japan expert who is now director of Monex Group.
The 10-year Treasury yield fell to 3.90% from 3.94% on Friday. The two-year Treasury yield, which most closely tracks expectations for Fed action, fell to 4.01% from 4.06%.
On Wall Street, while most stocks weakened, a 4.1% jump from Nvidia helped offset many of those losses. As one of the largest US stocks by value, Nvidia’s moves carry extra weight in the S&P 500 and other indices.
Altogether, the S&P500 rose less than a quarter point, 0.23, to 5,344.39. The Dow Jones fell 140.53 to 39,357.01 and the Nasdaq Composite gained 35.31 to 16,780.61.
Several major US companies release their latest earnings results later in the week, including Walmart and Home Depot. Most large North American companies have reported better profits than analysts expected.
In energy trading, benchmark U.S. crude fell 52 cents to $79.54 a barrel. Brent crude, the international standard, fell 63 cents to $81.67 a barrel.
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AP Business Writer Stan Choe contributed to this report.
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