SINGAPORE, Aug 29 (Reuters) – Asian equity markets
struggled for direction on Tuesday as the bounce from Beijing’s
efforts to support stocks ebbed, while bonds rallied and the
dollar dipped ahead of U.S. labour and manufacturing data due
later in the week.
Amid growing expectations those data points could come in
soft, U.S. Treasuries extended overnight gains, driving two-year
yields down 6.5 basis points (bps) to 4.9855% and
10-year yields down three bps to 4.1843%.
That put some gentle pressure on the dollar, which has
slipped below its 200-day moving average to $1.0833 per euro
and was slightly lower on other majors in early trade.
The yen remained an outlier and within a whisker of Monday’s
10-month low, which has traders on edge about the risk of
intervention. The yen last bought 146.34 per dollar.
MSCI’s broadest index of Asia-Pacific shares outside Japan
rose 0.4% as did Japan’s Nikkei.
“After opening strongly Hong Kong and China gave up most of
their gains yesterday and commodities remain unloved,” said
Damian Rooney, a dealer at Argonaut Securities in Perth, since
measures cutting stock-trading duties do little for the economy.
Over the weekend, China announced a halving in stock-trading
stamp duties and had on Friday approved some guidelines for
affordable housing.
Hong Kong’s Hang Seng closed less than 1% higher on
Monday and was 1% firmer in early trade on Tuesday. Mainland
blue chips were flat and the month is set to notch a
record for foreign outflows from the mainland stockmarket.
Even on Monday, as markets bounced, foreign investors
offloaded a net $1.1 billion in Chinese stocks and have been net
sellers in 15 out of 16 previous sessions – keeping downward
pressure on the yuan.
The yuan steadied at 7.2876 per dollar.
Highlighting the focus on property sector fears, shares in
indebted developer China Evergrande, which dropped
nearly 80% upon their return from suspension on Monday, were
down a further 6% on Tuesday.
“The underlying problem appears to be the adjustment in the
property sector and its spillover to the rest of the economy,”
Bank of Japan Governor Kazuo Ueda said at the Jackson Hole
symposium.
Beneath the headline moves, individual shares offered some
brighter spots.
Overnight shares in conglomerate 3M jumped 5% after
the company’s promise to pay $6 billion to settle a lawsuit over
its earplugs was smaller than some analyst estimates of
liabilities around $10 billion. Goldman Sachs shares rose
after it struck a deal to sell part of its wealth business.
On Tuesday in New Zealand shares in Tourism Holdings
, the world’s largest campervan rental company, surged
13% after the company reported a record underlying profit.
In currency markets, sterling and the Australian and New
Zealand dollars made small gains, with the pound last up 0.2% to
$1.2625 and the Aussie up by the same margin
to $0.6442.
In commodities, Brent crude futures slipped 0.2% to
$84.27 a barrel. On Tuesday, U.S. job openings figures are due,
ahead of Friday’s broader labour market data and the ISM
manufacturing survey.
“There’s anticipation of a bit of a slowing in the labour
market and cooling of the inflationary pulse,” said Ryan
Felsman, senior economist at the Commonwealth Bank of Australia
in Sydney.
(Additional reporting by Jason Xue in Shanghai. Editing by Sam
Holmes)
