· Stocks stall and dollar squeezed as investors wait for stimulus
U.S.-China tension and sobering economic data knocked momentum out of Asia’s stock markets on Thursday, though the hope of stimulus staved off falls and kept pressure on the dollar as investors wait for Congress to agree on a new spending package.
MSCI’s broadest index of Asia-Pacific shares outside Japan hit an early-session six-and-a-half-month peak but fell back to be flat after drops in China and Hong Kong.
· Japan stocks fall on grim earnings season; Toyota bucks trend
Japanese shares fell on Thursday as investors stayed away from risky bets amid a largely downbeat earnings season, though Toyota rose after unexpectedly avoiding a loss last quarter.
The Nikkei index ended down 0.43% at 22,418.15, with technology and consumer staples companies falling the most.
The broader Topix fell 0.31% to 1,549.88.
A series of disappointing earnings and forecasts from companies due to the COVID-19 pandemic have weighed on the Japanese market for the past few sessions.
Some analysts argue that the decline in corporate profit has bottomed out and earnings will gradually recover.
Others point to the likelihood of additional U.S. economic stimulus and work on developing a COVID-19 vaccine as reasons not to be overly pessimistic.
The stocks that gained the most among the Topix 30 names were Toyota Motor Corp up 2.29%, followed by commodities trader Mitsui & Co Ltd.
Toyota reported a 13.9 billion yen ($131.73 million) operating profit for the three months ended June, which was its worst in nine years but still better than expectations for a 179 billion yen loss.
· Shanghai share index closes higher for fifth day on financials boost
China’s benchmark Shanghai Composite Index ended higher for a fifth straight session on Thursday, as a rally in financial and materials stocks offset worries about rising Sino-U.S. tensions that had earlier weighed on the index.
At the close, the Shanghai Composite index was up 0.26% at 3,386.46, ending higher for a fifth straight day.
· European stocks open slightly lower amid earnings; Bank of England holds rates
European stocks opened slightly lower on Thursday morning, as investors reacted to a slew of corporate earnings and the Bank of England’s decision to leave interest rates unchanged.
The pan-European Stoxx 600 was down around 0.3% shortly after the opening bell, with almost all sectors trading in negative territory.
It comes after futures contracts tied to the major U.S. stock indexes closed flat on Wednesday, as investors monitored the ongoing brinkmanship between lawmakers over a new prospective stimulus package.
In corporate news, Siemens, ING and Mediobanca were among some of the companies set to report their latest quarterly results on Thursday.