Asia report: Most markets rise as Japan growth tops forecasts
By Josh White
Date: Monday 17 Feb 2025
(Sharecast News) - Asia-Pacific markets mostly advanced on Monday as investors assessed Japan's stronger-than-expected fourth-quarter economic growth while preparing for upcoming central bank decisions across the region.
Patrick Munnelly, market strategy partner at TickMill, said that it would be a subdued start to the week due to the US President's Day holiday, but that activity should ramp up.
"Geopolitics remain prominent with news that discussions regarding the Russian-Ukraine situation are set to commence in Saudi Arabia this week, although the identities of the participants remain somewhat uncertain," he said.
"The immediate threat of reciprocal tariffs from the US has diminished until April, yet the potential for these tariffs to encompass levies based on value-added taxes in other nations continues to be a significant concern.
"The possibility, regardless of how misguided, of the US imposing an extra 20% tariff on all imports from the EU, in addition to whatever other measures it chooses, and to varying extents on all other countries with VAT systems, is an extremely alarming scenario regarding its consequences for global economic growth."
Most markets start the week in the green
Japan's Nikkei 225 edged up 0.06% to 39,174.25, supported by gains in logistics and financial stocks.
Nippon Express surged 8.29%, Dai-ichi Life rose 7.93%, and Credit Saison climbed 6.84%.
The broader Topix index added 0.28% to 2,766.90.
In China, the Shanghai Composite gained 0.27% to 3,355.83, with notable performances from QuMei Home Furnishings Group, Sichuan Golden Summit Group, and Guangdong Sitong Group, all up over 10%.
The Shenzhen Component advanced 0.39% to 10,791.06.
Hong Kong's Hang Seng Index slipped marginally by 0.02% to 22,616.23, weighed down by losses in technology and consumer stocks.
Baidu fell 6.94%, JD Health International dropped 5.06%, and BYD Electronic International declined 5.01%.
South Korea's Kospi 100 climbed 0.66% to 2,599.42, lifted by a strong performance in materials and insurance stocks.
EcoPro Materials soared 12.38%, Samsung Fire & Marine Insurance rose 8.42%, and Hanwha Techwin gained 8.26%.
Australia's S&P/ASX 200 declined 0.22% to 8,537.10, pressured by weakness in banking and mining stocks.
Bendigo and Adelaide Bank plunged 15.28%, AMP fell 4.7%, and De Grey Mining lost 4.21%.
New Zealand's S&P/NZX 50 rose 0.61% to 13,068.93, driven by strong performances in the dairy sector.
Synlait Milk and A2 Milk Company both surged over 19%, while Freightways added 5.01%.
In currency markets, the dollar was last down 0.36% on the yen, trading at JPY 151.76, as it weakened 0.19% against the Aussie to AUD 1.5713, and retreated 0.17% from the Kiwi, changing hands at NZD 1.7438.
Oil prices advanced, with Brent crude futures last up 0.43% on ICE to $75.06 per barrel, and the NYMEX quote for West Texas Intermediate gaining 0.47% to $71.07.
Japan economy expands faster than expected in fourth quarter
In data, Japan's economy expanded faster than expected in the fourth quarter, with preliminary government data showing a 0.7% increase in GDP from the prior quarter, outpacing economists' forecasts of 0.3%.
Annualised growth came in at 2.8%, well above the 1% estimate.
The stronger-than-anticipated performance followed a revised 0.4% expansion in the prior quarter.
Following the GDP release, Japan's five-year government bond yield climbed to 1.034%, its highest level since October 2008, according to LSEG data.
Despite the positive figures, analysts remain cautious.
Moody's Analytics noted that while the data might suggest a turning point, Japan's preliminary GDP numbers often see significant revisions.
In Singapore, non-oil domestic exports fell 2.1% year-on-year in January, a sharper decline than the 1.1% drop projected by economists.
That followed a 9% contraction in December.
Official data indicated that while exports of non-electronic goods decreased, electronic shipments posted gains.
Meanwhile, the Reserve Bank of Australia began its two-day policy meeting, with markets watching for a potential interest rate cut on Tuesday.
Central banks in Indonesia and New Zealand are also set to announce their monetary policy decisions on Wednesday.
Reporting by Josh White for Sharecast.com.
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