Asian shares were a mixed bag on Friday after China’s latest set of economic data suggest the economy is recovering, even as risk sentiment sours ahead of Donald Trump’s inauguration.
China’s economy grew 6.8 percent in the fourth quarter from the previous year, slightly better-than-expected, on the back of government spending and record bank lending
For the full year of 2016 and in on-year terms, the economy expanded 6.7 percent as industrial output grew 6 percent, while fixed asset investments rose 8.1 percent, and retail sales jumped 10.9 percent.
Markets will also warily eye Trump’s inauguration speech and potential executive actions on his first day.
“If Trump emphasizes protectionist trade policies, then that could see some unwinding of the Trump rally.
On the other hand, if he focuses on making ‘America again’ through infrastructure spending then it is likely the market will react positively,” said economists at National Australia Bank, in a note on Friday.
After the American businessman’s surprise election victory in November, the dollar, treasury yields and U.S. shares rallied on expectations that a Trump administration would lead to lower tax rates, looser regulations in certain sectors and fiscal stimulus.
Dollar was weaker at 100.95 against currencies basket, slipping below the 101 handle after Federal Reserve chair Janet Yellen remark. The delay in tightening monetary policy could drive up inflation and force the Fed to raise rates in response, which could send the economy in a tailspin.
Mainland Chinese markets were in the green: the Shanghai composite closed up 0.69 percent or 21.5 points at 3,122.8 and the Shenzhen composite finished 1.52 percent or 28.3 points higher at 1,885.8.
Japan’s Nikkei 225 wavered between negative and positive territories ahead of the president-elect’s inauguration, to close up 0.34 percent or 65.7 points at 19,137.9.
Shares of Panasonic were up 1.26 percent, after it announced an extension of its partnership with Tesla beyond batteries and into autonomous driving technology.
Japanese brewery Kirin Holdings saw its stock jump 1.28 percent, after Brazilian financial newspaper Valor Economico reported that Kirin would sell its Brazilian beer operations to Heineken.
Australia’s S&P/ASX 200 finished down 0.66 percent or 37.4 points at 5,654.8, dragged by material and financial plays, but the Australian dollar remains on track to finish higher for the fourth straight week
“Chinese GDP helped the Australian dollar break to a 10-week high after beating consensus and rising for the first time in 10 quarters. The accuracy of China’s data will always remain in question yet it was enough to help Aussie bulls break the latest barrier,” said Matt Simpson.
Simpson is a senior market analyst at ThinkMarkets, in a Friday note.
The Australian dollar last traded at $0.7578, earlier hitting as high as $0.7588.
Biotech company CSL bucked the trend to extend its rally to trade up 2.78 percent, after it lifted its full-year profit forecast to 18-20 percent growth from 11 percent announced in August.
Over in South Korea, the Kospi closed down 0.35 percent or 7.2 points at 2,065.6 while Hong Kong’s Hang Seng dropped 0.56 percent by the afternoon.
In the U.S., the Dow Jones industrial average posted its fifth day of losses, down 0.37 percent at 19,732.4. The S&P 500 closed 0.36 percent lower at 2,263.69, while the Nasdaq composite slipped 0.28 percent to finish at 5,540.08.
The Mexican peso, largely viewed as a hedging proxy trade on Trump policies, last traded at 21.8822 against the greenback. The dollar/peso pair climbed to touched the psychological level of 22 during the past two sessions.
The yen strengthened above the 115 handle to trade at 114.59 against the greenback, while the euro fetched $1.0688 against the dollar, after the European Central Bank left monetary policy unchanged and maintained its bond-buying program on Thursday.
Spot gold, largely seen as a safe haven bet, was up at $1,208.90 an ounce.