Asia-Pacific markets experienced a mostly positive opening on Monday, with investors closely monitoring trade negotiations and sifting through a variety of economic data.
Notably, industrial output figures from South Korea and Japan for May were released, alongside China’s purchasing managers’ index readings for June.
China’s manufacturing sector has continued to show signs of contraction, marking a third consecutive month of decline in June. This downturn has heightened expectations for potential government stimulus measures aimed at alleviating the impact of ongoing trade disruptions with the United States.
In mainland China, the CSI 300 index remained flat, while the Hang Seng Index in Hong Kong saw a drop of 0.45%.
Conversely, Japanese equities bolstered their gains from the previous session, with the benchmark Nikkei 225 reaching an over 11-month peak. The Nikkei 225 rose by 1.48%, and the broader Topix index was up by 0.77%.
The Kospi index in South Korea climbed by 0.82%, while the small-cap Kosdaq edged up by 0.31% amid fluctuating trading conditions.
In Australia, the S&P/ASX 200 index recorded a gain of 0.59%.
Meanwhile, India’s major stock indices, the Nifty 50 and BSE Sensex, remained unchanged during early trading.
U.S. equity futures indicated positive momentum in Asia ahead of the year’s second half.
Last Friday, all three major indices on Wall Street experienced notable gains. The S&P 500 reached a new high in over four months, closing approximately 0.5% higher at 6,173.07, surpassing its earlier record of 6,147.43.
Similarly, the Nasdaq Composite also made history, closing at an all-time high with an approximate 0.5% increase, while the Dow Jones Industrial Average rose nearly 1%.
The robust performance of the three indices this month reflects a sharp recovery from the lows experienced in April, which were fueled by heightened trade policy tensions.
However, the ongoing fluctuations in global trade negotiations remain a significant factor influencing market sentiment and could pose a risk to the sustainability of this market rally.
In Hong Kong, technology stocks saw gains despite the overall decline of the Hang Seng Index for the third consecutive session, which was down by 0.42% around 12:26 p.m. local time.
Contrastingly, the Hang Seng Tech Index saw a slight increase of 0.12%.
The top performers on this tech-centric index included Kingsoft Corporation, which surged by 2.96%, Kuaishou Technology gaining 2.95%, and Tencent Music Entertainment Group, which rose by 3.44%.
Meanwhile, Japan’s Nikkei 225 sustained its upward trend for a fifth consecutive session, hitting an 11-month high with an impressive increase of 1.49% to reach 40,747.31 as of 12:47 p.m. local time.
This marked its highest level since July 17, 2024. Leading the charge among gainers were Olympus Corp, which surged by 6.16%, followed by Tokyo Electric Power Company increasing by 4.11%, and SoftBank Group climbing by 4.81%.
In another notable market event, shares of Thai coconut water producer IFBH experienced a dramatic rise, soaring by as much as 67% shortly after their debut on the Hong Kong Exchange.
The shares reached 46.50 Hong Kong dollars ($5.92) during early trading, after being issued at the peak price of HK$27.80. The IPO was met with overwhelming demand, being oversubscribed more than 2,000 times and attracting major cornerstone investors like UBS Asset Management, Black Dragon, and ICBC Wealth Management.
However, not all companies saw positive market responses. Shares of Li Auto, listed in Hong Kong, fell sharply by as much as 4.34% following a downward revision in their delivery forecast for the latter half of the year.
The electric vehicle manufacturer now expects to deliver approximately 108,000 vehicles from July to December, which is below their previous guidance range of 123,000 to 128,000 units.
This adjustment follows a sales system upgrade aimed at bolstering its long-term growth plans, as outlined in a statement released last Friday.
On the economic front, Japan’s industrial output data revealed a modest increase of 0.5% in May compared to the previous month, a figure significantly lower than the anticipated 3.5% increase forecasted by economists polled by Reuters.
The sectors contributing most to the rise included production machinery and motor vehicles, according to preliminary data from the Ministry of Economy, Trade and Industry.
Nevertheless, weakness was noted in various sectors, such as transport equipment as well as inorganic and organic chemicals.
In South Korea, factory output also faced challenges, declining by 2.9% in May, continuing a downward trend for the second month in a row and missing expectations set by economists in a Reuters poll.
The industrial production index, adjusted for seasonal variations, fell significantly short of the anticipated 0.1% contraction, following a previous decline of 0.6% in April. Year-on-year, the index showed a mere 0.2% increase in May, considerably lower than the 5.1% rise reported in April.
Retail sales also reflected a stagnation in South Korea, remaining flat in May following a decline of 0.9% in April, hitting their lowest levels since August 2024, as reported by LSEG data.
Overall, this week’s developments reflect a complex interplay of market movements and economic indicators across the Asia-Pacific region.
image source from：nbcchicago
