Financial

Asian Shares Closed Mixed as Stuttering Inflation Trend Continues

Asia shares end mixed as China projections slip

Asian shares ended mixed on Tuesday in a busy session across markets, as the Bank of Japan showed little change on stimulus efforts but China projections was down official PMI figures.
The Shanghai Composite decreased 0.25% in Greater China, while the Hang Seng index dipped 0.13%. China shared the official manufacturing PMI for October at 51.6, not far from the expected level of 52, and its non-manufacturing survey at 54.3, after projecting 55.4 in the previous month.

After the Bank of Japan reported its asset purchases at 80 trillion yen annually as expected, the Japan’s Nikkei fell 0.27 %. Its short-term interest rate maintained at 0.1% as the BoJ also had its core inflation forecast at 1.8%, showing little change from July, reiterating its view on the economy that risks are on balance.

On Monday, Nintendo announced that its full-year profit forecast nearly doubled, reaching 120 billion yen from its previous 65 billion yen. The electronics company also projected a quarterly profit of 23.7 billion yen, beating the expected 19 billion yen. Nintendo shares rose 6.25 %

U.S. stocks ended lower overnight on the same day as gains in tech stocks were sidetracked by a slump in financials, after a report suggested that the White House is considering a plan that would gradually decrease the U.S. corporate tax rate.

The Dow Jones Industrial Average closed higher at 23,348, while the S&P 500 ended 0.32% higher. The Nasdaq Composite was down 0.03% and closed at 6698.96.

In Australia, private sector credit rose 0.3% for the month of September, in comparison with the 0.5% gain seen that month. Australia’s S&P/ASX 200 edged down 0.01%

Inflation Trend

Stuttering Inflation trend continues

Over on the side of the economic data front, the inconsistent inflation continued while consumer spending is at its fastest growing rate since August 2009.

The Fed’s preferred inflation measure which is the personal consumption expenditures price index, with exception of food and energy, increased 1.3 % in the 12 months through September.

The numbers are in-line with expectations but still under the Fed’s 2% target, driving expectations that interest rates will be kept lower longer as the trend of subdued inflation will continue.

Consumer spending jumped 1% last month, stated the Commerce Department on Monday. It accounts for more than two-thirds of U.S. economic activity.

Both reports came ahead of the Federal Reserve’s two-day policy meeting which will be held on Thursday.

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