Asian stock markets closed mixed on Friday, while oil prices rose and the dollar mostly climbed.
Hong Kong and Shanghai markets were handed some support by a report that property group China Evergrande had made an overdue interest payment ahead of a Friday deadline, buying it a little more breathing space as it struggles to address a debt crisis that many fear could spill over into the wider economy.
And China’s central bank injected 200 billion yuan ($31.3 billion) on Friday through seven-day reverse repurchase agreements into the banking system, bringing the weekly net cash injection to the highest in 21 months.
The People’s Bank of China (PBOC) said its website the move was to “maintain stability in month-end liquidity conditions.”
With 100 billion yuan worth of reverse repos maturing on Friday, the central bank has injected 100 billion yuan on a net basis on the day.
For the week, the PBOC has injected 680 billion yuan through reverse repos, the biggest weekly cash offering since January 2020.
Hong Kong shares finished slightly lower after warnings from Apple and Amazon on supply problems, which added to concerns about inflation and a spike in Covid cases in mainland China.
The Hang Seng Index fell 0.70%, or 178.49 points, to 25,377.24.
The Shanghai Composite Index rose 0.82%, or 28.92 points, to 3,547.34, while the Shenzhen Composite Index on China’s second exchange added 1.60%, or 37.79 points, to 2,400.03.
Nikkei Flat Ahead of Poll
In Tokyo, stocks finished Friday with gains following another record close on Wall Street and ahead of a weekend general election.
The benchmark Nikkei 225 index added 0.25%, or 72.60 points, to 28,892.69, for a weekly gain of 0.30%, while the broader Topix index put on 0.08%, or 1.52 points, to 2,001.18 – almost unchanged over the previous seven days.
Investors shied away from making big bets as Japan prepares for Sunday’s lower house vote, with local media reporting that the ruling party is likely to lose seats. “A wait-and-see stance increased in late trade ahead of the general election,” Okasan added.
Meanwhile, in Seoul, the Kospi was down 1.29%, Jakarta was up by 1.03%, Singapore and Bangkok were down slightly, while the Sydney Stock Exchange also fell, by 1.44%. In Mumbai, the BSE Sensex was down 1.13%
Apple, Amazon Results Cool Sentiment
Forecast-beating profits from some of the world’s biggest companies have helped fan a rally across global equities this month, helping to temper concerns about surging inflation and the end of the era of central bank largesse.
But the results from Apple and Amazon, coupled with eurozone inflation data on Friday, soured sentiment heading into the weekend break.
European stock markets also retreated on Friday, dragged down by the disappointing earnings from Apple and Amazon, with additional pressure coming from news of soaring eurozone inflation.
The US tech titans announced billions of dollars in quarterly profits on Thursday, but supply chain bottlenecks and the global chip shortage dented performance.
Ahead of the Apple and Amazon results, US stocks had closed higher Thursday, with the tech-heavy Nasdaq striking a new all-time high.
In the United States, a drop in net jobless claims to a fresh pandemic-era low helped overcome data showing the US economy expanded at a weaker pace than expected in the third quarter owing to a slowdown in consumer spending caused by Covid infections.
Investors also kept a wary eye on the world’s biggest economy after President Joe Biden unveiled a new social and environmental spending package worth $1.75 trillion – half the original cost – that he hopes will appeal to both factions of his Democratic Party after months of painful negotiations.
Inflation jump
In Europe, inflation surged to a record rate this month as high energy prices jumped and supply woes bit, Eurostat said on Friday, casting a cloud over the recovery from the coronavirus pandemic.
Year-on-year inflation hit 4.1% in October, more than double the European Central Bank’s (ECB) target and tying the record rate last seen in July 2008, as energy prices jumped almost a quarter, the agency said.
Overall the eurozone economy was so far maintaining its steady recovery from Covid-19 restrictions, growing at 2.2% in the third quarter of the year, Eurostat added.
All eyes next week will be on the Federal Reserve, which is widely expected to announce plans on tapering its vast stimulus package.
The Bank of England is, meanwhile, set to raise its main interest rate from a record-low 0.1% at its meeting also next week.
Key figures around 1100 GMT
Tokyo – Nikkei 225: UP 0.3% at 28,892.69 (close)
Hong Kong – Hang Seng Index: DOWN 0.7% at 25,377.24 (close)
Shanghai – Composite: UP 0.8% at 3,547.34 (close)
New York – Dow: UP 0.7% at 35,730.48 (close)
London – FTSE 100: DOWN 0.4% at 7,222.23 points
West Texas Intermediate: UP 0.3% at $83.09 per barrel
• AFP and Reuters with additional editing by Jim Pollard
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