Asian Stock Market: Trades mixed even as China Q1 GDP grows at record pace

  • Asian shares drift lower, fail to track Wall Street gains.
  • US Treasury yields recovery, stock futures print mild losses amid vaccine, geopolitical fears.
  • China data came in mixed while comparing with strong market consensus.

Asian equities remain pressured despite firmer markets in China, New Zealand and India while heading into Friday’s European session.

As a result, MSCI’s index of Asia-Pacific shares outside Japan print 0.10% intraday gains while Japan’s Nikkei 225 copies the moves by being around 29,671 by the press time. However, Australia’s ASX 200, South Korea’s KOSPI and Indonesia’s IDX Composite Index print mild losses at the time of the press.

Hopes of faster economic recovery in the US, backed by strong economics, favored Wall Street benchmarks to refresh record top the previous day. Though, doubts over the Johnson & Johnson vaccine’s usage and a delay in economic recovery due to that seem to have weighed on the market sentiment.

Also challenging the mood could be the US-Japan discussions to jointly battle China as well as American sanctions on Russia over election interference and hacking. Furthermore, comments from China’s National Bureau of Statistics, suggesting relatively big pressure on employment in 2021 exert additional downside pressure on the market sentiment.

It’s worth mentioning that China marked the heaviest economic growth since at least early 1992 despite the Q1 2021 GDP lagged behind the market consensus of 18.9% to 18.3% YoY.

Amid these plays, S&P 500 Futures drop 0.16% on a day after refreshing the all-time high on Thursday whereas the US 10-year Treasury yield rises over five basis points (bps) to 1.58% following its drop to a one-month low the previous day.

Given the return of the vaccine woes and geopolitical fears, risk catalysts will be the key to observe. However, the recently strong US data highlights the importance of today’s US Michigan Consumer Sentiment Index for fresh impulse.



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