Most Asia markets up after China inflation


Most Asian stock markets rose Friday after China released data showing the first rise in factory gate prices for more than four years, while the Thailand’s baht rallied from this week’s sharp losses after the country’s long-reigning king died.

Beijing said the producer price index increased last month after 54 consecutive months of falling, beating estimates for a drop and providing some much-needed hope for the Chinese economy a day after market-sapping trade figures.

Chinese firms have for years been battered by falling prices for their goods in the face of chronic overcapacity and weak demand, putting a damper on growth in a key driver of the world economy.

Consumer prices also rose more than expected.

“The end of PPI deflation is a good signal for the economy’s stabilisation,” Gao Yuwei, a researcher at Bank of China in Beijing, told Bloomberg News. “PPI is expected to be remain expansionary in the coming months.”

Traders around Asia broadly welcomed the news on the world’s number two economy and key driver of global expansion, which is struggling with a years-long fight against slowing growth.

Hong Kong added 0.5 percent and Sydney — where several firms with close ties to China are listed — gained 0.1 percent, while Seoul was up 0.5 percent. However, Shanghai eased 0.3 percent on worries the data will give the Chinese central bank reason to hold off any stimulus measures.

Tokyo ended the morning up 0.1 percent.

– Eyes on Thailand –

Attention will turn to Bangkok, where the stock market is due to open at 0300 GMT for the first time after the announcement that King Bhumibol Adulyadej had died after seven decades on the throne.

The market and the baht had tumbled this week as news emerged that he was gravely ill, fuelling worries about economic and political stability in the military-ruled nation.

While he wielded no official power, Bhumibol was considered a uniting force in a fractured nation where political tensions are still raw two years after a military coup.

Despite the concerns, the baht rose 1.2 percent against the dollar Friday, with analysts saying the king’s death had now been cooked into prices.

“The uncertainties and political risks have been more or less priced in,” said Margaret Yang, an analyst at CMC Markets in Singapore. “We may still see some panic selling but I don?t expect this to last for very long. Eventually smart money will flow in to support the market.”

In Seoul Samsung Electronics rose 0.6 percent as investors brushed off its warning that it expects a $3 billion hit to operating profit from its exploding battery crisis.

– Key figures around 0230 GMT –

Tokyo – Nikkei 225: UP 0.1 percent at 16,785.20 (break)

Hong Kong – Hang Seng: UP 0.5 percent at 23,137.22

Shanghai – Composite: DOWN 0.3 percent at 3,051.99

Pound/dollar: DOWN at $1.2238 from $1.2253 late Thursday

Euro/pound: DOWN at 90.23 pence from 90.25 pence

Euro/dollar: DOWN at $1.1043 from $1.1056

Dollar/yen: UP at 103.83 yen from 103.66 yen

Oil – West Texas Intermediate: UP seven cents at $50.51 per barrel

Oil – Brent North Sea: DOWN 14 cents at $52.89

New York – DOW: DOWN 0.3 percent at 18,098.94 (close)

London – FTSE 100: DOWN 0.7 percent at 6,977.74 (close)

© 2016 AFP

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