By Gina Lee
Investing.com – Asia Pacific stocks were mostly up on Monday morning, with quarterly growth data released by China showing growth, and optimism over the latest U.S. stimulus package.
The world’s second largest economy’s GDP grew 4.9% year-on-year during the third quarter, with industrial production growing 6.9% year-on-year and retail sales growing 3.3% year-on-year in September. The unemployment rate stood at 5.4%, down from the previous quarter’s 5.6% reading. Although the growth in GDP was larger than the previous quarter’s 3.2% growth, it was smaller than the 5.2% predicted in forecasts prepared by Investing.com.
“The GDP numbers came in slightly below expectations, but the monthly data shows there is no reason to be overly pessimistic. China’s economy remains on the recovery path, driven by a rebound in exports. Consumer spending is also headed in the right direction, but we cannot say it has completely shaken off the drag caused by the coronavirus. The problem is that the labor market and wages remain a little weak, and this is holding back consumption. China needs to continuously roll out more policies to support domestic demand,” Dai-ichi Life Research Institute chief economist Yoshikiyo Shimamine told Reuters.
China’s Shanghai Composite edged up 0.24% by 11:04 PM ET (3:04 AM GMT) while the Shenzhen Component inched down 0.07%, giving up some earlier gains.
Hong Kong’s Hang Seng Index was up 0.88%.
Japan’s Nikkei 225 jumped 1.06%. Japan also released data earlier in the day that showed exports fell 4.9% year-on-year in September, the smallest margin in seven months. Imports dropped 17.2% year-on-year, and the trade balance stood at JPY675 billion.
South Korea’s KOSPI gained 0.90%
In Australia, the ASX 200 rose 0.99%. The Reserve Bank of Australia will release the minutes from its latest meeting on Tuesday.
In the U.S., House of Representatives Speaker Nancy Pelosi set a Tuesday deadline for Congress to pass the stimulus measures before the Nov. 3 presidential election, negotiating details with Treasure Secretary Steven Mnuchin during their phone call on Saturday. Pelosi and Mnuchin have also scheduled a phone call for later in the day.
Some investors remained optimistic about the measures regardless of whether voters choose incumbent President Donald Trump or Democrat Joe Biden on Nov. 3.
“It seems that the market is optimistic that indeed stimulus will follow whether that is tax cuts under a Trump presidency or spending under a Biden presidency,” Medley Global Advisors managing director Ben Emons told Bloomberg.
However, with Mnuchin on a tour of the Middle East and Pelosi’s team sending mixed signals after she set the deadline, others were less optimistic about the measures’ prospects.
Trump also renewed an offer to increase the price tag on the measures over the weekend. He and Biden will participate in the final presidential debate on Thursday.