Asian stocks mixed as China’s Oct. industrial production data misses forecasts

Asian stocks were mixed in Thursday afternoon trade, while China’s October industrial production data showed it missed expectations.

Mainland Chinese shares gained by the afternoon, with the Shenzhen component adding 0.36 percent and the Shenzhen composite also advancing 0.402 percent. The Shanghai composite was fractionally higher.

Chinese industrial production data for October grew 4.7 percent year-on-year, Reuters reported citing official data. That compared against expectations of a 5.4 percent growth from a Reuters poll.

Hong Kong’s Hang Seng index slipped 0.92 percent. Shares of Chinese tech juggernaut Tencent dropped 2.69 percent after the heavyweight announced on Wednesday a 13 percent year-on-year drop in profit.

Elsewhere, Japan’s Nikkei 225 slipped 0.9 percent as shares of Familymart dropped about 3 percent. The Topix index also traded 1.07 percent lower.

Shares of Z Holdings, previously named Yahoo Japan, skyrocketed more than 17 percent after the firm said Thursday it was in discussions to merge with Line.

Japan’s economic growth touched one-year low in the third quarter, Reuters reported Thursday citing government data. GDP grew 0.2 percent on an annualized rate in the third quarter, well lower than a median market forecast of a 0.8 percent rise.

Shares in Australia edged higher, with the S&P/ASX 200 up about 0.3 percent. Shares of major miner BHP, however, slipped 0.24 percent after the company announced that CEO Andrew Mackenzie will retire at the end of 2019.

Australia’s unemployment rate released on Thursday showed it edged up to 5.3%, an increase from a dip in September. Net new jobs was down 19,000 in October — the largest decline since late 2016, according to Reuters.

South Korea’s Kospi added 0.21 percent.

Overall, the MSCI Asia ex-Japan index was 0.47 percent lower.

US-China trade

Developments in U.S.-China trade continue to be monitored, with a reported impasse being hit between the two economic powerhouses as they seek to finalize a limited trade agreement amid a tariff war that has lasted for more than a year.

“I think we’re … heading to a stage where there could be big moves in markets,” Rob Subbaraman, head of global macro research at Nomura, told CNBC’s “Squawk Box” on Thursday.

Subbaraman said the trade negotiations are getting very interesting amid the recent developments on disagreements between Beijing and China. This comes as the December 15 deadline — when additional tariffs by the U.S. on Chinese exports are set to kick in — approaches, he said.

“I think markets which were quite hopeful around a deal have pulled back a little bit and they’re getting back into maybe, more neutral territory,” Subbaraman said.

Fed watch

Fed Chair Powell addressed the Congressional Joint Economic Committee on Wednesday. In prepared remarks, Powell said the path of the central bank’s interest rates is unlikely to change as long as the economy keeps growing.

“We see the current stance of monetary policy as likely to remain appropriate as long as incoming information about the economy remains broadly consistent with our outlook of moderate economic growth, a strong labor market, and inflation near our symmetric 2 percent objective,” he said in the prepared testimony.

Still, he warned that challenges such as low inflation and weakness overseas linger. Powell’s testimony comes after the Fed’s third rate cut for the year in October.

Currencies and oil

The U.S. dollar index, which tracks the greenback against a basket of its peers, was last at 98.358 after seeing highs above 98.4 yesterday.

The Japanese yen, often seen as a safe-haven currency in times of market uncertainty, traded at 108.66 against the dollar after strengthening from levels above 108.9 in the previous session.

The Australian dollar changed hands at $0.6798 after seeing an earlier high of $0.6841 yesterday.

Oil prices rose in the afternoon of Asian trading hours. The international benchmark Brent crude futures contract added 0.37 percent to $62.60 per barrel. U.S. crude futures gained 0.49 percent to $57.40 per barrel.

Source: CNBC

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