Asia Stocks Mixed; Japan Yields Swing on BOJ: Markets Wrap

Bloomberg.com — Asian stock markets were mixed on Friday, though the regional share gauge still headed to cap the strongest week since early June, following a series of steps by China shifting to stimulus mode.

Japanese equities climbed for a fourth day, shrugging off a decline in Nomura Holdings Inc. following a profit slide. Intensifying speculation about tweaks to the Bank of Japan’s stimulus program saw 10-year yields briefly trading above 0.1 percent — against the BOJ target of about zero — before slipping as the central bank said it offered to buy bonds. Stock indexes in China and Hong Kong ticked lower, with the offshore yuan bouncing off its weakest level in more than a year. The dollar held its advance and Treasury yields remained below 3 percent.

Central bank policy is back at the forefront of market discussions. China’s onshore currency is heading for a sixth straight week of declines as the People’s Bank of China continues to embrace faster liquidity and credit growth. The PBOC told some banks this week that a specific capital requirement will be eased to support lending, Bloomberg News reported.

The European Central Bank said Thursday it will stick to its plan to end bond purchases and pledged to keep interest rates unchanged “at least through the summer of 2019.” In Japan, reports suggest officials are debating ways to reduce the side effects of their yield-curve control policy.

Elsewhere, West Texas crude held gains after an attack on Saudi tankers stoked supply concerns. The Turkish lira took another beating Thursday after Trump threatened sanctions if the nation doesn’t release an American pastor.