Asia-Pacific Stocks Mostly Advance as China's Factory Prices Rise More Than Expected

Soichiro Koriyama | Bloomberg via Getty Images
  • Asia-Pacific stocks largely rose on Thursday.
  • China's consumer price index and producer price index for September were released on Thursday.
  • Singapore's Straits Times index gained 0.24% as of 3:27 p.m. local time, recovering from earlier losses after the country's central bank unexpectedly tightened monetary policy on Thursday.

SINGAPORE — Asia-Pacific stocks were largely higher in Thursday trade as investors reacted to the release of China's inflation data for September.

Mainland Chinese stocks closed mildly lower. The Shanghai composite declined 0.1% to 3,558.28 while the Shenzhen component dipped fractionally to around 14,341.38.

Producer inflation surged in September, official data showed Thursday. The producer price index for September soared 10.7% as compared with a year ago, slightly above expectations in a Reuters poll for a 10.5% increase.

China's consumer price index also rose 0.7% in September as compared with a year ago. That was slightly below the 0.9% on-year increase as forecast in a Reuters poll.

"The inflationary pressure, particularly … on the producer price front, is quite persistent and will be a problem going into next year as well," Zhiwei Zhang, chief economist at Pinpoint Asset Management, told CNBC's "Street Signs Asia" on Thursday.

Some impact from higher energy prices would translate into increased consumer prices next year as well, he said.

The persistent inflationary pressure also limits the People's Bank of China's scope for monetary policy easing, Zhang warned.

PBOC Governor Yi Gang said Wednesday that inflation in China is moderate overall, according to a CNBC translation of a Thursday post on the Chinese central bank's website.

Singapore's central bank tightens monetary policy

Singapore's Straits Times index gained 0.24% in the afternoon, recovering from earlier losses after the country's central bank unexpectedly tightened monetary policy on Thursday.

Official advance estimates also showed Thursday that Singapore's economy grew 6.5% year-on-year in the third quarter of 2021. That was largely in line with expectations from economists in a Reuters poll, who had expected a 6.6% year-on-year expansion for the third quarter.

Elsewhere, the Nikkei 225 in Japan advanced 1.46% to close at 28,550.93 while the Topix index edged 0.67% higher to end the trading day at 1,986.97. South Korea's Kospi closed 1.5% higher at 2,988.64.

In Australia, the S&P/ASX 200 climbed 0.54% on the day to 7,311.70.

MSCI's broadest index of Asia-Pacific shares outside Japan traded 0.52% higher.

Markets in Hong Kong were closed on Thursday for a holiday.

Minutes from the U.S. Federal Reserve's September meeting released Wednesday showed officials at the central bank could begin a "gradual tapering process" by mid-November.

Currencies and oil

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 93.898 after falling recently from above 94.4.

The Japanese yen traded at 113.40 per dollar, weaker than levels below 112.5 seen against the greenback earlier this week. The Australian dollar changed hands at $0.7405, above levels below $0.735 seen yesterday.

Oil prices were higher in the afternoon of Asia trading hours, with international benchmark Brent crude futures up 0.9% to $83.93 per barrel. U.S. crude futures gained 0.85% to $81.12 per barrel.

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