Asian Markets Meander on Weak China Inflation Data

Shares meandered in Asia on Monday, after China reported consumer prices were steady but wholesale prices fell in March. Japan’s announcement of mixed trends in machinery orders did little to improve sentiment given the continued strengthening of the Japanese yen.

Tokyo’s Nikkei 225 stock index fell 0.6 percent to 15,730.40 and Australia’s S&P/ASX 200 edged 0.1 percent lower to 5,012.00. South Korea’s Kospi lost 0.1 percent to 1,969.61 and shares fell in Indonesia and Singapore. Hong Kong’s Hang Seng index gained 0.3 percent to 20,435.67 and the Shanghai Composite Index jumped 2.1 percent to 3,045.75.

“Strong gains in the oil market and a solid close in U.S. markets should see a positive open to the trading week this morning,” said Rick Spooner, chief market analyst at CMC Markets. But in the longer term, he noted, “Yen buying is essentially signaling that further stimulus by the BOJ and ECB will have limited impact.”

China reported its inflation rate in March was 2.3 percent, unchanged from February, while the producer price index, or wholesale prices paid at the factory gate, dropped 4.3 percent. Like most weak data, the reports spurred expectations among investors of further stimulus to help boost the economy.

Core machinery orders excluding ships and contracts for electric power companies fell 9.2 percent in February from the month before, slightly better than anticipated but a reversal from a 15 percent month-on-month increase in January. Overall, the data reflect anemic growth in corporate capital investment, which may be constrained in coming months by the recent appreciation in the Japanese yen against the dollar and by sluggish consumer demand, analysts said.

U.S. crude oil gained 9 cents to $39.81 a barrel in electronic trading on the New York Mercantile Exchange. It gained 46 cents on Friday to $39.72. Brent crude oil lost 1 cent to $41.92 a barrel in London. It rose $2.51 to $41.94 a barrel on Friday.

The dollar slipped to 107.85 yen from 108.10 yen in the previous trading session. The euro rose to $1.1412 from $1.1402 on Friday.