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Nikkei slips below 20000; Asia eyes China inflation data

Asian stocks outside of Japan advanced on the last trading day of the week, drawing support from a stronger finish on Wall Street overnight and as China’s consumer inflation held steady in March.

The consumer price index (CPI) rose 1.4 percent on year, above expectations of a 1.3 percent rise predicted in a Reuters poll and following a 1.4 percent rise in February. Wholesale prices, or the producer price index (PPI), fell 4.6 percent in March, better than the average forecast of a 4.6 percent, and after dropping 4.8 percent in February.

Overnight, US stocks closed higher after trading in a narrow range, with energy shares up on the back of a rebound in the price of crude oil. The Dow Jones Industrial Average added 0.3 percent, while the S&P 500 and Nasdaq Composite gained 0.4 and 0.5 percent, respectively.

Nikkei slips 0.1 percent

Japan’s Nikkei 225 index crossed the 20,000 milestone for the first time since April 2000 at the open, but quickly pulled back seemingly on the back of profit-taking and as the dollar-yen ticked down slightly to 120.46.

The bourse settled at 19,937 on Thursday – a 15-year peak for the second straight session – as foreign investors jumped in amid expectations that Japan Inc will start coughing up more cash to shareholders.

Index heavyweight Fast Retailing is in the spotlight after upgrading its forecast for annual profit and sales projection as sales for its casual wear brand Uniqlo grew quicker-than-expected. The stock was up 3.3 percent, hitting fresh record highs.

Lawson dived 4.1 percent, chalking up its biggest one-day drop in two years, after the convenience store operator’s earnings guidance came in below market expectations.

Mainland indices mixed

China’s Shanghai Composite index inched up 0.2 percent, reversing a lower open, as latest inflation data signalled a favorable environment for further government stimulus.

In Hong Kong, the Hang Seng index appear set to chalk up a three-day long blistering rally, up 1 percent at the open and hitting its highest level since January 2008. Meanwhile, the Hang Seng China Enterprises Index of Hong Kong-listed mainland companies jumped 1.4 percent.

The surge in buying was sparked by Beijing’s decision to let mainland money managers buy H-shares last week, as well as a recent move by the China Insurance Regulatory Commission to allow mainland insurance firms to invest in Hong Kong’s Growth Enterprise Market for the first time.

“What they are trying to do is to take the steam out of China’s local market and redirect some of the liquidity into Hong Kong [so that] eventually Hong Kong will be at a very high level,” Viktor Shvets, Asia head of Strategy Research at Macquarie, told CNBC Asia’s “Squawk Box.”

GF Securities – the mainland’s fourth-largest securities firm by assets – opened up 37.4 percent to HK$ 25.90 in its market debut on Friday. The Shenzhen-listed company had priced its shares at HK$ 18.85 – the top of the indicative range – raising $ 3.6 billion, according to an April 2 statement.

ASX adds 0.2 percent

Australian shares inched up early Friday, recouping some of the resources-led losses in the previous session.

Laggards on the S&P ASX 200 index include global miner BHP Billiton, which extended losses to decline 0.7 percent, following another slide in its U.S. ADRs overnight. Fortescue Metals and Rio Tinto also dropped 1.7 and 0.2 percent, respectively.

The four major lenders hovered in neutral territory, while gold producers were mixed as a stronger dollar weighed on spot gold for a third straight session overnight. Evolution Mining and Newcrest Mining lost more than 1 percent each, while Endeavor Mining rose 3.1 percent.

Kospi rises 1 percent

South Korea’s Kospi index scaled a 7-month high, with automakers, retailers and brokerage houses leading advances a day after the Bank of Korea (BOK) kept interest rates steady at 1.75 percent as expected.

Among gainers, Hyundai Securities and SK Hynix made gains of over 5.5 and 4.3 percent each, while Hyundai Motor and Kia Motors rose 3.4 and 2 percent, respectively.

Shares of Samsung Electronics elevated 0.3 percent, with the global launch of its Galaxy S6 and Galaxy S6 Edge smartphones.

Noble Group eyed

Shares of Noble Group tanked 1.7 percent, extending losses after investment research firm Muddy Waters said on Thursday it had a short position on the commodity trader. The stock has been hammered over the past month following a slew of critical reports about the firm’s accounting practices by Iceberg Research.


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