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Asia Equities Rebound As Investors Turn Focus to U.S. Inflation Data

Published 02/12/2018, 01:03 AM
Updated 02/12/2018, 01:03 AM
Investors await U.S CPI data out later this week

Investors await U.S CPI data out later this week

Investing.com - Asia stocks were trading higher on Monday following a week-long selloff in equities and bonds, as investors await U.S CPI data out later this week to find out if another bout of volatility is in store. The CPI is expected to slow to 1.9% but anything higher than that would increase risks of more aggressive rate rises, which was widely seen as the catalyst of the global rout in the first place.

Hong Kong and China were in focus today as Japan’s Nikkei was closed for National Foundation Day holiday, but volatility is expected to be low ahead of the Chinese New Year Holiday later this week. Hang Seng Index were trading 0.7% higher at 12:56am ET with medical and airline stocks among the outperformers, while Shanghai Composite and Shenzhen Component also gained 0.7% and 2.7% respectively. Hong Kong-listed Geely Automobile Holdings (HK:0175) said its parent Zhejiang Geely would build a new energy vehicles (NEV) production base in east China at a cost of $5 billion.

While not a directional driver, China’s National Development and Reform Commission (NDRC) received some attention as it released a full list of sensitive sectors, including real estates, hotels and entertainment, where it plans to restrict outbound investment.

Reports in Japan suggested that Haruhiko Kuroda is likely to be reappointed Bank of Japan chief to another five-year term, as Prime Minister Shinzo Abe wanted aggressive stimulus and inflation to continue. Meanwhile, automotive parts company Takata made headlines after it reached a US bankruptcy deal with its creditors and lawyers and will sell its viable operations. The company’s air bags were previously linked with 21 deaths and hundreds of injuries.

Elsewhere, the S&P/ASX 200 underperformed its regional peers and closed 0.3% to hit a 3-months low with utilities, telecoms services and gold sectors among the weakest performers.

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