Japan led Asian markets into negative territory as yen strengthened
Major Asian markets (AAXJ) were trading lower on May 2, 2016, after negative sentiments from the previous week continued. They were under more stress as the PMI (Purchasing Managers’ Index) for Asian markets came out on a mixed note. Many of the major indexes were closed in Asia on May 2 due to a holiday.
The Japanese (DXJ) Nikkei 225 took a heavy fall on May 2 as the Japanese yen continued to garner strength. The US dollar to Japanese yen currency pair, which is inversely related to the Japanese yen, was trading at 106.6. The Chinese (MCHI) DJ Shanghai index was closed for the day.
Losses in the Oceania indexes were less compounded. The Australian (EWA) index S&P/ASX 200 and the Dow Jones New Zealand (VPL) had slight falls of 0.18% and 0.34%, respectively. The Indian (INDA) index was also negative, falling 0.56%.
Asian manufacturing PMI mixed
The manufacturing PMI release from the Asian economies for April came out on a mixed note. The Korean manufacturing PMI was 50.0 against forecasts of 50.2. While the Japanese PMI came in above the forecasts, it was still below 50. A PMI above 50 indicates an expansion in the economy. The Japanese PMI came in at 48.0. The Taiwan and Indonesia PMIs came in on a contrasting note at 49.7 and 50.9, respectively. The Indian PMI was also below forecasts at 50.5.
Inflation and current account releases from Asian countries
The Korean current account came in on a positive note, rising to $10.1 billion against the previous month’s $7.7 billion. In terms of inflation release in the Asian region, Thailand’s year-over-year inflation rose 0.07%, while core inflation rose 0.78%. The Indonesian inflation rate rose 3.6% on a year-over-year basis but fell 0.45% on a month-over-month basis.
In the next part of this series, let’s see how European markets fared on May 2.