Asian stock markets made a slight comeback Friday in anticipation of efforts to shore up the Japanese and global economies, but fears of double-dip recession still lurked.
Tokyo’s Nikkei index ended the day up 0.95 percent, or 84.58 points, at 8.991,06, after a four-day losing streak. Amid a recovery for exporters, Toyota gained 0.44 percent despite announcing the recall of 1.13 million of its popular Corolla vehicles in North America.
Sydney’s S&P/ASX 200 also recovered, ending up 0.32 percent, while Shanghai rose 0.28 percent, or 7.26 points, to 2,610.74. But Hong Kong closed down just 14.71 points at 20,597.35, its sixth session of declines.
Markets tanked at the start of the day after Wall Street tumbled on Thursday as traders braced for a sharp downward revision of US growth later on Friday.
However there were hopes that a conference of central bankers in the US might point the way out of a potential double-dip recession and in turn give comfort to major exporters such as Japan.
Investors “want to make their positions neutral before the weekend” Mizuho Investors Securities trading information manager Teruhisa Ishikawa was quoted by Dow Jones Newswires as saying.
Tokyo was also buoyed by the prospect of comments by Prime Minister Naoto Kan addressing the country’s fading recovery. In the event he promised to outline measures on Tuesday.
“Excessive volatility in currency markets negatively affects economic and financial stability and I recognize its gravity,” he said.
“I will take determined steps when necessary,” said Kan, who has few options for reducing the yen’s value but is under growing pressure over the economy and faces a challenge to his leadership from “shadow shogun” Ichiro Ozawa.
In New York the blue-chip Dow Jones Industrial Average closed below the sensitive 10,000 level for the first time in nearly two months, dropping 0.74 percent to 9,985.81.
Compounding Japanese pessimism, data showed that deflation remained entrenched in July, with the core consumer price index falling 1.1 percent from a year earlier, its 17th straight month of decline.
In one bright spot, Japan’s unemployment rate edged lower to 5.2 percent in July, its first fall in six months and a 0.1 percentage point drop from June.
Meanwhile in Shanghai, sentiment was boosted by strong results from oil companies such as Petro China and China Oilfield Services and an assurance of stable economic policy for the rest of the year from Finance Minister Xie Xuren.
The dollar firmed against the yen on the hopes of action by Japanese authorities.
The dollar fetched 84.73 yen in Tokyo afternoon trade, firming from 84.37 yen in New York late Thursday. The euro stood at 1.2723 dollars compared with 1.2720 in New York and rose to 107.82 yen from 107.35 yen.
Oil prices retreated as concerns about the weak US economic data pervaded markets, analysts said.
