Tokyo, Japan (BBN)-Japan’s investors gave a mixed reaction to revised growth numbers released on Tuesday which showed the country’s economy contracted less than originally estimated in the three months to June.
After starting in positive territory, the benchmark Nikkei was later down 0.31 per cent at 17,804.86, reports BBC.
Japan’s economy contracted 0.3 per cent during the quarter, compared to original calculations of a 0.4 per cent contraction.
The revision beat market expectations for a contraction of 0.5 per cent.
Japan also revealed a revised contraction in private consumption on Tuesday – to 0.7 per cent from a previous estimate of a 0.8 per cent.
Japan relies on domestic consumption for about 60 per cent of its economy. However, it has been recovering from a sales tax hike which has dampened spending.
Economists said all eyes would be on China again today after markets there traded erratically on Monday following a four-day weekend.
The Shanghai Composite on the mainland was down 1.18 per cent in early trade at 3,044.76, while Hong Kong’s Hang Seng benchmark index was up 0.46 per cent at 20,680.14.
Chris Weston from IG Markets said investors would be watching out particularly for China’s August trade balance statistics due out later – and that local markets would be “scrambling” for some sort of lead.
He said the market was expecting the surplus to widen to $48bn, with exports expected to fall 6.6 per cent and imports 7.9 per cent.
“Horrible numbers would not be a surprise and could be a source of volatility for markets in the afternoon,” Weston added, “especially with the market already on edge about Chinese growth.”
He also noted there had been “a good level of focus overnight” on the $93bn drop in China’s foreign exchange reserves “and that it was certainly more aggressive than what the consensus had been calling for.”
In Australia the S&P/ASX 200 was in positive territory on Tuesday, up 0.87 per cent at 5,073.40 points despite some nervous investor sentiment around what could happen to China’s stock market.
South Korea’s Kospi benchmark index moved into negative territory in mid morning trade, down 0.48 per cent at 1,874.51 points.
The negative investor sentiment there follows the won falling to a near four-year low against the dollar on Monday after Tesco sold its South Korean business Homeplus.