Asian shares were mostly higher on Monday after Japan and China reported data reflecting relatively sluggish growth in Asia’s two largest economies.
The Euro Soared on Far Right National Rally gained a strong lead during the first round of parliamentary elections, while the Japanese yen fell to around 161 yen to the dollar. U.S. futures and oil prices rose.
Pollsters suggest the National Rally could win a majority in the lower house of parliament, but the outcome is uncertain and the electoral system is complex.
The euro cost $1.0757, up from $1.0713.
US futures and oil prices rose.
Japan’s benchmark Nikkei 225 rose 0.3% to 39,693.29 after a quarterly survey by the Bank of Japan, known as the “tankan”, showed a modest improvement in confidence among the country’s biggest manufacturers in the April-June quarter.
However, the government has revised down its forecast for growth in the first quarter of the year, from -1.8% to -2.9% year-on-year.
“Across all sectors and company sizes, business conditions remained stable at 12, which has historically been consistent with (quarterly) GDP growth around 0%,” said Marcel Thieliant of Capital Economics in assessing the tankan. “A renewed slowdown in GDP growth this quarter would be consistent with the slump in industrial production that companies forecast for June.”
The Shanghai Composite rose 0.3% to 2,976.64 after a survey of factory purchasing managers over the weekend showed conditions continued to contract for a second straight month.
But a similar private sector survey of manufacturing activity released Monday showed an improvement in business conditions. The Caixin Manufacturing PMI rose to 51.8 on a scale of 100 in June, up from 51.7 in the previous month. Readings above 50 are considered a sign of an expansion.
Hong Kong markets were closed for a public holiday.
Australia’s S&The P/ASX 200 lost 0.3% to 7,744.20. South Korea’s Kospi rose 0.2% to 2,802.87 after a private sector survey showed South Korean factory activity was the best since April 2022.
A late-day rush of selling on Friday sent the S&P500 down 0.4% at 5,460.48 and in the red for the week. The Nasdaq Composite fell 0.7% to 17,732.60, while the Dow Jones Industrial Average ended 0.1% lower at 39,118.86.
Despite the somber finish, the S&The P 500 and the Nasdaq remain near their all-time highs.
The S&The P500 rose 3.5% in June and is up about 14.5% so far this year.
The Nasdaq is up about 6% this month and 18.1% this year.
A pullback in big tech stocks, which were big winners in the market’s record run-up, weighed on the market Friday. Apple fell 1.6%, Microsoft lost 1.3% and Meta Platforms ended down 3%.
A report showed inflation continues to declineInvestors are hoping that cooling inflation will prompt the Federal Reserve to cut interest rates, which are still at their highest level in more than 20 years.
Consumer prices rose 2.6% in May from a year ago, according to the latest index of personal consumption expenditures (PCE). That was a continued easing from 2.7% in April and well below the peak of 7.1% two years ago.
Government bond yields rose in the bond market after initially losing ground following the latest signal of easing inflation. The yield on the 10-year Treasury bond, which influences interest rates on mortgages and other consumer loans, rose to 4.38%. The yield on the 2-year Treasury note, which is more in line with expectations for Fed action, rose to 4.74% from 4.72% just before the data was released.
The Fed raised interest rates to the highest level in more than two decades in an effort to return inflation to the 2% target. Other inflation measures, including the well-known consumer price index, have also confirmed that price pressures are easing.
In energy trading, U.S. benchmark crude rose 39 cents to $81.93 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, rose 41 cents to $85.41 a barrel.