Japanese stocks fell, after the Topix index posted its steepest monthly gain since April 2013, as a China factory gauge signaled a third month of contraction. Non-ferrous metal producers led declines.
The Topix retreated 1.2 percent to 1,538.97 as of 9:00 a.m. in Tokyo, after surging 10 percent last month. The Nikkei 225 Stock Average lost 1.3 percent to 18,844.69 on Monday. The yen traded at 120.51 per dollar, strengthening for a second day after the Bank of Japan held off from adding to monetary easing on Friday. China’s official factory gauge — the first key economic indicator for this quarter — came in at 49.8 in October, missing economists’ estimates and holding below 50, the line between expansion and contraction.
China’s official non-manufacturing purchasing managers index, a barometer of services and construction, fell to 53.1 from 53.4 in September, the weakest since December 2008.
E-mini futures on the Standard & Poor’s 500 Index slipped 0.2 percent after the underlying measure fell 0.5 percent on Friday, closing out October with an 8.3 percent gain, the best month in four years. The Stoxx Europe 600 Index advanced 8 percent, its biggest monthly rally since July 2009.
Japanese stocks rose for a second day after a report showed the country’s economy shrank less than previously reported. Non-ferrous metals producers led gains, while brokerages dropped.
The Topix index climbed 0.3 percent to 1,449.37 as of 9:02 a.m. in Tokyo, with four stocks rising for every three that fell. The Nikkei 225 Stock Average added 0.5 percent to 17,944.11. The yen fell 0.2 percent to 119.47 per dollar as a report showed Japan’s second-quarter gross domestic product shrank an annualized 1.2 percent compared with a previous estimate of a 1.6 percent contraction.
Economists had forecast the GDP revision to show a 1.8 percent contraction. A separate report showed the nation’s July current account surplus was 1.81 trillion yen, wider than economist estimates of 1.73 trillion yen.
Turnover was light, with volume on the Topix 10 percent below the 30-day intraday average as investors awaited the release of August data on the China’s trade. Economists estimate exports from the world’s second-biggest economy shrank 6.6 percent from a year earlier, while imports contracted by 7.9 percent.
Futures on the Standard & Poor’s 500 Index rose 0.9 percent from Friday’s close. U.S. markets were closed Monday for Labor Day.
Source : Bloomberg