TOKYO – TODAY ONLINE, MARCH 1, 2016 – Asian stock markets struggled to post big gains on Tuesday (March 1) as oil prices fell again and weak Chinese manufacturing data deflated investors’ spirits, although stimulus moves by the Chinese central bank tempered the bad news.
The mixed picture for stocks across the region followed a choppy session on Wall Street where the major indices finished Monday in the red, as profit-taking set in following a string of gains in the last two weeks.
Worries about China boosted the Japanese yen — seen as a safe haven in times of turmoil — which weighed on the Tokyo stock market as the stronger currency threatened exporters’ profitability.
Tokyo’s benchmark Nikkei 225 index was down 0.69 per cent by the lunch break, while Shanghai edged up 0.20 per cent and Hong Kong added 0.55 per cent. Sydney was up 0.54 per cent.
On Monday, China’s central bank cut the proportion of funds banks must set aside as reserves, in Beijing’s latest attempt to tackle slowing growth in the world’s second largest economy.
Policymakers trimmed the so-called “reserve requirement ratio” (RRR) for financial institutions by 0.50 percentage points, freeing up more funds for them to lend.
The move came after a G20 finance ministers’ meeting in Shanghai, which stressed the use of all available policy tools to boost global growth, and with Chinese and world stock markets hammered by worries over the economy.
“The RRR (reserve requirement ratio) announcement offered something for everyone,” Mr Sean Callow, a foreign-exchange strategist in Sydney at Westpac Banking Corp, told Bloomberg News.
“You could welcome the easing as supportive of growth and indicative of less pressure from capital outflows, or you could see it as a reflection of even greater weakness than expected,” Mr Callow added.