HONG KONG, April 16 — Asian markets rose today as record Chinese economic growth reaffirmed the country’s strong recovery, while traders tracked a Wall Street surge fuelled by blockbuster reports on US consumer spending and jobless claims.
Officials in Beijing said the world’s second-biggest economy expanded 18.3 per cent in the first quarter, boosted by a sharper-than-expected increase in retail sales that gave hope the country’s vast army of consumers are again dipping into their pockets.
The economic growth figure was the highest since records began three decades ago, enhanced by its chronically weak comparison figure from last year, though the reading was slightly below forecasts in an AFP survey.
Analysts also pointed out that the quarter-on-quarter growth was below estimates.
“China’s growth will trend lower going forward,” said OANDA’s Edward Moya, though he did say it “will likely prevent policymakers from tightening too quickly”.
Asian markets struggled in early trade but picked up the pace as the day moved on. Shanghai led gains with Hong Kong, while Tokyo, Sydney, Seoul, Mumbai, Singapore, Taipei, Bangkok and Wellington were also well up. Manila and Jakarta edged down.
London, Paris and Frankfurt rose at the open.
The tepid performance at the end of the week came despite a strong lead from Wall Street, where the Dow ended above 34,000 for the first time and the S&P 500 clocked yet another record.
‘Smooth as silk’
The rally in New York came on the back of figures showing US jobless claims came in at their lowest level since the pandemic began, while retail sales soared 9.8 per cent on-month in March as Americans began spending their US$1,400 (RM5,777) stimulus handouts, helped by the roll-out of vaccines.
Traders were also buoyed by the fact that Treasury bond yields — a gauge of future interest rates — fell, soothing worries that the expected strong bounce in economic activity would send inflation rocketing and force the Federal Reserve to raise its record-low borrowing costs.
“US consumers wasted little time stuffing stimulus checks into starving retailer cash registers with stocks surging to cash register rings across the United States as consumers are made willing and able to spend, thanks to the US’s speedy vaccine rollout,” said Axi strategist Stephen Innes.
“With the Fed keeping the sugar taps open and offering up free tickets for investors to come frolic in the markets like ‘kids in the candy store’, the transition from policy to growth has been as smooth as silk with a benign reaction in yields suggesting that a growth tantrum is not on the cards anytime soon.”
And OANDA’s Moya added that the US economy would likely continue to see more healthy readings over the coming months as Joe Biden’s US$1.9 trillion stimulus, his planned US$2.25 trillion infrastructure plan and pent-up consumer demand will send it into “overdrive”.
Key figures around 0810 GMT
Tokyo — Nikkei 225: UP 0.1 per cent at 29,683.37 (close)
Hong Kong — Hang Seng Index: UP 0.6 per cent at 28,969.71 (close)
Shanghai — Composite: UP 0.8 per cent at 3,426.62 (close)
London — FTSE 100: UP 0.4 per cent at 7,008.64
Dollar/yen: UP at 108.94 yen from 108.72 yen at 2040 GMT
Pound/dollar: DOWN at US$1.3742 from US$1.3784
Euro/dollar: DOWN at US$1.1977 from US$1.1966
Euro/pound: UP at 87.16 pence from 86.81 pence
West Texas Intermediate: UP 0.4 per cent at US$63.71 per barrel
Brent North Sea crude: UP 0.4 per cent at US$67.22 per barrel
New York — Dow: UP 0.9 per cent at 34,035.99 (close) — AFP
