Asian stocks declined on Friday, extending their weekly loss, after the Bank of Japan quashed expectations for further stimulus and earnings from PetroChina to China Petroleum and Chemical disappointed investors.
The MSCI Asia Pacific Excluding Japan Index retreated 0.6% to 415.68 as of 4.19pm in Hong Kong (3.19pm in Thailand), heading for a weekly loss of 1.9 and a 0.3% monthly decline.
Stocks retreated this week as Japan’s central bank refrained from boosting monetary stimulus and earnings at companies from Canon to Oversea-Chinese Banking left investors unsatisfied. Focus now turns to profit reports due from Citic Securities, China’s biggest brokerage, and Chinese manufacturing data due at the weekend. Japan’s market is closed Friday for a holiday.
“Central banks look like they have run out of bullets to a degree,” Mark Lister, head of private wealth research at Craigs Investment Partners in Wellington, which manages about $7.2 billion, said by phone. “We’re getting to that point where there are limits to the results they can get from anything more they do. This points to a fragile outlook with still a lot of risks out there.”
The MSCI Asia Pacific Index, the regional equities gauge which includes Japan, is down 1.5% this week. Still, it’s up 1.7% this month, on course for the first back-to-back monthly advance since April 2015.
Hong Kong’s Hang Seng Index declined 1.5% and the Shanghai Composite Index lost 0.3%. China raised its daily yuan fixing rate against the dollar by the most since July 2005.
An official purchasing managers’ index probably rose to 50.3 in April from 50.2 in March, according to the median estimate in a Bloomberg survey. The data are scheduled to be released May 1. A reading above 50 indicates expansion.
Regional Gauges
Australia’s S&P/ASX 200 Index added 0.5%, while New Zealand’s S&P/NZX 50 Index rose 0.5%.
South Korea’s Kospi index fell 0.3% as industrial output unexpectedly declined in March. Singapore’s Straits Times Index retreated 0.8% and Taiwan’s Taiex index slumped 1.1% after data showed the nation’s economy shrank more than forecast in the first quarter.
It’s been a busy week of earnings reports across the region. PetroChina sank 3.6% in Hong Kong after reporting a 13.8 billion yuan ($2.1 billion) loss for the first quarter on Thursday, its first since it started trading publicly in 2000. Its state-owned peer, China Petroleum and Chemical, the Asian oil refining behemoth known as Sinopec, lost 1.3%. Cnooc dropped 2.3% after reporting a decline in revenue.
The Bank of Japan kept bond-buying, its negative interest rate and exchange-traded fund purchases unchanged at its meeting Thursday.