Japan’s Nikkei 225 falls 2% as Asia-Pacific stocks slip; China’s April trade data comes in above expectations

SINGAPORE — Shares in Asia-Pacific fell on Monday as investors watched for market reaction to Chinese trade data that came in better-than-expected. In Japan, the Nikkei 225 fell 2.35%, leading losses among the region’s major markets as shares of Fast Retailing dropped more than 6%. The Topix index shed 1.69%. Mainland Chinese stocks were higher as the Shanghai Composite hovered above the flatline while the Shenzhen Component rose 0.48%. China’s dollar-denominated exports grew 3.9% year-on-year in April, customs data showed Monday. They were above expectations for a 3.2% rise by analysts in a Reuters poll. China’s dollar-denominated imports were unchanged in April compared to a year ago, better than an expected 3% drop, according to Reuters. The data came as mainland China continued to battle its worst Covid outbreak since early 2020. Chinese President Xi Jinping on Thursday emphasized that the country should stick to its “dynamic zero-Covid” policy. “It is unclear how quickly China will pivot towards living with COVID,” Tapas Strickland, an economist at National Australia Bank, wrote in a Monday note. “As for data, it is expected to take a backseat given lockdowns/enhanced restrictions in many parts of the country.” Elsewhere, South Korea’s Kospi slipped 1.14% while the S&P/ASX 200 in Australia declined 1.18%. MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1.26%. “We’ve cautioned about getting too bearish,” Steve Brice, chief investment officer at Standard Chartered Wealth Management, told CNBC’s “Street Signs Asia” on Monday. “If you look at indicators … from a market perspective, that bearishness is coming through as well, and that’s usually a buying opportunity,” said Brice. “I know there’s a lot of challenges out there … in terms of the inflation outlook, but you know, the markets are already pricing in very, very sharp monetary policy tightening. At some point we will find a bottom.” Markets in Hong Kong are closed today for a holiday.

Currencies and oil

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 103.98 following a recent jump from levels below 103.2. The Japanese yen traded at 130.92 per dollar, weaker as compared with levels below 129 seen against the greenback last week. The Australian dollar changed hands at $0.7008 after last week’s drop from above $0.721. Oil prices were higher in the afternoon of Asia trading hours, with international benchmark Brent crude futures rising 0.12% to $112.53 per barrel. U.S. crude futures were above the flatline at $109.79 per barrel.