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Asia-Pacific Stocks Mixed as Private Survey Shows China's Factory Activity Contracted in May

Noriko Hayashi | Bloomberg via Getty Images
  • Asia-Pacific stocks were mixed on Wednesday.
  • China’s Caixin/Markit manufacturing Purchasing Managers' Index for May came in at 48.1 on Wednesday, an improvement over April's reading of 46 but still remaining below the 50-level mark that separates expansion from contraction.
  • Australia's gross domestic product grew 0.8% quarter-on-quarterly in seasonally adjusted chain volume terms during the first quarter, data from the country's Bureau of Statistics showed Wednesday. That was above expectations in a Reuters poll for a 0.5% gain.

SINGAPORE — Shares in Asia-Pacific were mixed on Wednesday, with investors watching for market reaction to the release of a private survey on Chinese factory activity for May.

Mainland Chinese stocks closed mixed, with the Shanghai Composite sliding 0.13% to 3,182.16 while the Shenzhen Component was gained 0.205% to 11,551.27. Hong Kong's Hang Seng index slipped 0.55%, as of its final hour of trading.

China’s Caixin/Markit manufacturing Purchasing Managers' Index for May came in at 48.1 on Wednesday, an improvement over April's reading of 46 but still remaining below the 50-level mark that separates expansion from contraction.

China's official manufacturing PMI for May, released Tuesday, came in at 49.6 — an improvement over April's reading of 47.4. The May reading was above the 48.6 level expected from a Reuters poll.

PMI readings are sequential and represent month-on-month expansion or contraction.

The Nikkei 225 in Japan gained 0.65% to close at 27,457.89 while the Topix index advanced 1.36% to 1,938.64.

In Australia, the S&P/ASX 200 climbed 0.32%, finishing the trading day at 7,234. Australia's gross domestic product grew 0.8% quarter-on-quarterly in seasonally adjusted chain volume terms during the first quarter, data from the country's Bureau of Statistics showed Wednesday. That was above expectations in a Reuters poll for a 0.5% gain.

MSCI's broadest index of Asia-Pacific shares outside Japan slipped 0.45%.

"We're in a relatively calm period, there has been a risk-on environment that's been triggered by some degree of opening up in China," Manishi Raychaudhuri, head of Asia-Pacific equity research at BNP Paribas, told CNBC's "Street Signs Asia" on Wednesday. "There has also been commentary, a narrative that the risk perception is way too high among institutional investors."

"That said, we must also keep in mind that we're now about to enter a period of quite severe monetary policy tightening," he added. "We have to brace for the impact at least, you know, in the next one quarter or so."

Markets in South Korea were closed on Wednesday for a holiday.

Oil rises 1%

Oil prices were higher in the afternoon of Asia trading hours, with international benchmark Brent crude futures up 1.12% to $116.89 per barrel. U.S. crude futures gained 1.17% to $116.01 per barrel.

Those gains came on the back of a Monday agreement by the European Union for a ban on most Russian oil imports by the end of the year, along with investor optimism over a reopening in the major Chinese city of Shanghai following weeks of Covid-related lockdowns.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 101.981 after seeing an earlier low of 101.738.

The Japanese yen traded at 129.40 per dollar, weaker than levels below 127.8 seen against the greenback earlier in the week. The Australian dollar was at $0.7174, still stronger than levels below $0.708 seen last week.

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