Asia report: Markets mixed, Korean GDP growth misses forecasts

(Sharecast News) - Asia-Pacific markets closed mixed on Thursday as investors digested economic data and monitored policy developments. Chinese equities led gains after Beijing encouraged institutional investors to increase stock purchases, while other markets in the region showed varying performances.

Stephen Innes, managing partner at SPI Asset Management, noted that there was an "apparent push" by the Chinese government to ignite a stock market rally amidst a lacklustre economic backdrop.

"The authorities are coaxing local institutional investors like insurers and mutual funds to ramp up their market investments," he said.

"Yet, as we've seen in the past, such efforts can be likened to attempting to kindle a fire with damp wood - often proving ineffective and short-lived.

"This latest attempt is likely another instance where initial enthusiasm may quickly fizzle out, serving as yet another false dawn for the Chinese markets."

China leads gains on mixed day for region

In China, the Shanghai Composite rose 0.51% to 3,230.16, supported by strong performances from companies such as ADD Industry Zhejiang and Shanghai LongYun Advertising & Media, both surging over 10%.

However, the Shenzhen Component slipped 0.49% to 10,176.17, reflecting a more cautious sentiment among investors.

Japan's Nikkei 225 climbed 0.79% to 39,958.87, driven by a rally in major stocks, including Mitsubishi Heavy Industries, which gained 8.55%.

The broader Topix index advanced 0.53% to 2,751.74.

Investors were closely watching the Bank of Japan's ongoing policy meeting, with expectations of a potential rate hike following recent signals from governor Kazuo Ueda.

Hong Kong's Hang Seng Index fell 0.4% to 19,700.56, weighed down by losses in key stocks such as Semiconductor Manufacturing International Corporation, which declined 7.24%.

In South Korea, the Kospi 100 dropped 1.23% to 2,523.01, with major technology and industrial stocks under pressure.

Kumyang and LG Innotek led the losses, shedding 7.68% and 6.82%, respectively.

Australia's S&P/ASX 200 index fell 0.61% to 8,378.70, with resource stocks dragging the market lower.

Iluka Resources and Liontown Resources posted significant declines, losing 6.47% and 6.38%, respectively.

New Zealand's S&P/NZX 50 edged up 0.18% to 13,060.08, with healthcare and retail stocks providing support.

Fisher & Paykel Healthcare gained 2.66%.

In the currency markets, the dollar was last down 0.04% on the yen, trading at JPY 156.46, while it strengthened 0.03% against the Aussie to AUD 1.5945, and advanced 0.05% on the Kiwi, changing hands at NZD 1.7662.

Oil prices inched higher, with Brent crude futures last up 0.32% on ICE at 79.25 per barrel, and the NYMEX quote for West Texas Intermediate increasing 0.3% to $75.67.

South Korean economy grows less than expected, Japan exports top forecasts

In economic news, South Korea's economy grew 1.2% year on year in the fourth quarter, marking its slowest pace since mid-2023.

The figure fell short of the 1.4% growth forecast by economists, and was weaker than the 1.5% expansion recorded in the prior three months.

On a quarterly basis, the economy expanded just 0.1%, missing expectations of a 0.2% increase.

Despite the slowdown in the final quarter, full-year GDP growth for 2024 reached 2%, improving from the 1.4% expansion in the prior year.

In Japan, exports rose 2.8% in December from a year earlier, surpassing market expectations of 2.3% growth.

However, the figure was lower than the 3.8% increase recorded in November.

Imports rose by 1.8%, falling short of the projected 2.6% gain but rebounding from a decline in the previous month.

Japan registered a trade surplus of JPY 130.9bn, significantly outperforming expectations of a JPY 53bn deficit.

Elsewhere, Singapore's core inflation - which excludes accommodation and private transport costs - rose 1.8% year on year in December, slightly above the anticipated 1.7% increase.

The figure was marginally lower than the 1.9% growth seen in November.

Headline inflation stood at 1.6%, exceeding market forecasts of 1.5%.

Reporting by Josh White for Sharecast.com.