BEIJING (AP) – Asian stock markets were mixed Monday after a surveyed showed Japan’s manufacturing outlook improving and Prime Minister Shinzo Abe’s party was defeated in Tokyo municipal elections.
KEEPING SCORE: Tokyo’s Nikkei 225 index gained 0.3 percent to 20,089.03 and Sydney’s S&P-ASX 200 shed 0.6 percent to 5,688.10. The Shanghai Composite Index was unchanged at 3,190.41 while Hong Kong’s Hang Seng added 0.1 percent to 25,789.14. Seoul’s Kospi retreated 0.6 percent to 2,386.37 and India’s Sensex advanced 0.7 percent to 31,144.20. Benchmarks in Singapore, Bangkok and Jakarta rose while New Zealand and Taiwan fell.
JAPANESE MANUFACTURING: The central bank’s Tankan survey of large manufacturers found they believe business conditions are improving and plan to increase investment as export demand recovers. A separate survey of factory purchasing managers also indicated the outlook improved in June for the 10th straight month. Stronger demand from China and other Asian markets is driving a recovery but forecasts suggest conditions will deteriorate.
TOKYO ELECTIONS: Abe’s Liberal Democratic Party lost control of the Tokyo metropolitan assembly, winning only 23 of 127 seats in weekend elections. Tokyo Gov. Yuriko Koike’s Tokyoites First Party won 49 seats and its allies an additional 20. The voting was seen as a barometer of national politics following a string of scandals and could hamper Abe’s plans to stay in office through 2020.
ANALYST’S TAKE: “Asian markets are set for a mixed start to the week with early movers clocking next to neutral changes from the lack of strong leads,” said Jingyi Pan of IG in a report. The Tankan “yielded surprisingly positive results,” said Pan. “Both large manufacturer’s index and outlook had surprised on the upside and certainly helped to counter some of the pressure from a stronger JPY and concerns over the election results over the weekend.”