Market Talk – Wednesday, Jan. 27

ASIA:

Profits at China’s industrial firms grew for the eighth straight month in December, suggesting a sustained recovery as the manufacturing sector rapidly emerged from its COVID-19 slump, Reuters reported. Profits surged 20.1% year-on-year in December to 707.11-billion-yuan ($109.40 billion), after rising 15.5% in November, the National Bureau of Statistics (NBS) data showed on Wednesday. China is the only major economy in the world to avoid a contraction in 2020, with gross domestic product up 2.3% for the full year, while many countries remain crippled by the pandemic. For the full year of 2020, annual profits for China’s industrial firms grew 4.1% year-on-year to 6.45 trillion yuan, recovering from a 3.3% on-year decline seen in 2019.

India is likely to double health spending in the next fiscal year with the aim of raising expenditure in the sector to 4% of gross domestic output in the coming four years, two officials said, as the country looks to fix its health system after the coronavirus pandemic. Reuters reported India will likely raise its health spending to 1.2-1.3 trillion rupees (USD 16.46- USD 17.83 billion) in the fiscal year starting April 1, from the current year’s projected spending of 626 billion rupees.

Japan’s economy will likely recover to levels before the coronavirus pandemic as early as March next year, Bank of Japan Governor Haruhiko Kuroda said on Monday, offering an upbeat view on its recovery prospect despite headwinds from COVID-19. Kuroda also said a combination of expansionary fiscal and monetary policies have successfully stabilized Japan’s economy, signaling that the BOJ has offered sufficient stimulus for now to cushion the economic blow from the health crisis.

The major Asian stock markets had a mixed day today:

  • NIKKEI 225 increased 89.03 points or 0.31% to 28,635.21
  • Shanghai increased 3.91 points or 0.11% to 3,573.34
  • Hang Seng decreased 93.73 points or -0.32% to 29,297.53
  • ASX 200 decreased 44.10 points or -0.65% to 6,780.60
  • Kospi decreased 17.75 points or -0.57% to 3,122.56
  • SENSEX decreased 937.66 points or -1.94% to 47,409.93
  • Nifty50 decreased 271.40 points or -1.91% to 13,967.50
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