Japan's Nikkei 225 grows almost 2% on recovery to switch; Asia shares cross

August 15, 2022: – Japan stocks increased on return to trade. At the same time, shares in the Asia-Pacific were mixed on Friday following solid gains in the previous session as investors accepted the U.S. inflation report.

The Nikkei 225 increased 2.62% to 28,546.98, while the Topix index rose 2.04% to 1,973.18. Japanese markets were closed on Thursday for a holiday.

On Friday, Japan’s Prime Minister Fumio Kishida said he would ask his government to come up with ways to address increasing fuel and food prices in the country, Reuters stated. Inflation in Japan is not as hot as in different countries but is hovering over the central bank’s 2% target.

South Korea’s Kospi was up by 0.16% higher at 2,527.94, while the Kosdaq was fractionally lower at 831.63.

Shares of Samsung Electronics increased 0.5% as South Korea’s president, Yoon Suk-yeol, officially said the group’s vice chairman, Jay Y. Lee.

“I will live up to the expectations of the country and the government’s considerations and revitalization the economy by sustained investment and job creation for young people,” Lee added.

Mainland China markets dipped. The Shanghai Composite is shedding 0.15% to 3,276.89, while the Shenzhen Component is losing 0.44% to 12,419.39.

China’s largest chipmaker Semiconductor Manufacturing International Corporation, said that a net profit of $514 million in the second quarter of 2022 was a 25% drop from a year ago. Revenue grew 42% to $1.9 billion.

SMIC’s Hong Kong-listed shares were 4.18% lower in the final hour of trade. The broader Hang Seng index was 0.24% higher in the late afternoon.

MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.12%.

Thailand’s market is closed for a holiday Friday.

“If you look at the valuation, Asian equities are not expensive. But I think there are growth downside risks, particularly for China, and that, I think, will keep a lid on the overall market performance,” Eddy Loh, chief investment officer at Maybank Group Wealth Management, told CNBC on Friday, explaining Maybank’s neutral stance on Asia stocks.

The three significant averages opened the session higher but lost steam as the day progressed. The S&P 500 was fractionally lower at 4,207.27, while the Nasdaq Composite shed 0.58% to 12,779.91. The Dow is inching 27.16 points, or 0.08%, higher to 33,336.67.

“Financial markets initially responded positively to the Producer Price Index data that showed inflation in the U.S. is moderating, but gains then whittled away on matters the market may have overreacted,” according to an ANZ Research note.

The PPI for July dropped 0.5% from June, in comparison with an expected 0.2% rise, according to a Dow Jones survey.