Asian stocks rose for a third day with a weaker yen buoying equities in Tokyo as investors await developments in Greece and U.S. jobs data. Chinese shares slumped as regulators moved to stem a sell-off.
Honda Motor Co., the carmaker that gets 86 percent of sales outside Japan, climbed 3.5 percent and contributed most to gains on the Topix index. The Shanghai Composite Index slid 3.5 percent as margin traders continued to unwind positions amid doubts over the effectiveness of government measures to support equities. Commonwealth Bank of Australia rose 1.7 percent, leading lenders in Sydney higher.
The MSCI Asia Pacific Index gained 0.1 percent to 146.69 as of 4:02 p.m. in Hong Kong. Shares in the U.S. and Europe climbed on Wednesday as Greece signaled it was ready to compromise on ending a standoff over bailout aid. The bid was rejected by euro-area leaders, who have said they won’t hold talks until after Sunday’s referendum on creditors’ demands.
“There has to be a negotiated deal there and I think the market believes there will be at the end of the day despite the drama,” Michael Cuggino, a fund manager at Pacific Heights Asset Management LLC in San Francisco, told Bloomberg TV. “Corporate earnings in the second quarter along with the labor data will give us an indication as to what we’re going to see going forward.”
Monthly U.S. jobs data is due after the close of Asian markets on Thursday.
Most markets outside Shanghai gained on Thursday. Japan’s Topix index advanced 0.7 percent after the yen slid 0.5 percent Wednesday. Hong Kong’s Hang Seng Index gained 0.2 percent. Australia’s S&P/ASX 200 Index climbed 1.5 percent and South Korea’s Kospi index rose 0.4 percent. New Zealand’s NZX 50 Index advanced 0.8 percent.
China bucked the trend even after securities regulators relaxed margin-trading rules and cut equity-transaction fees in their latest attempts to prevent a bear market from deepening.
“Clearly it’s not helped the market as we’ve seen today,” said Tai Hui, Hong Kong-based chief Asia market strategist at JPMorgan Asset Management. “It’s a puzzle why they’re allowing this relaxation which can potentially fuel more volatility going forward. By bending or twisting the rules of the game, they make it more dangerous going forward. That is a bit of a worry.”
The regulator announced late Wednesday it will no longer require brokerages to force the sale of stock held by clients with insufficient collateral, while the Shanghai Stock Exchange said the nation’s two bourses will lower transaction fees by 30 percent on Aug. 1. The moves follow a weekend interest-rate cut and calls by the regulator for investors to act rationally and not believe “shorting China rumors.”
Chinese stocks have been on a rollercoaster over the past two weeks with investors torn between hefty valuations and the government’s efforts to prop up the market.
The Standard & Poor’s 500 Index added 0.7 percent and the Stoxx Europe 600 Index jumped 1.5 percent on Wednesday after two days of declines. E-mini futures on the S&P 500 gained 0.2 percent on Thursday.
In the U.S., companies added 237,000 workers in June, the most in six months, data from Automatic Data Processing Inc. showed Wednesday. A separate report showed manufacturing expanded in June at the fastest pace in five months, indicating domestic demand is allowing American factories to withstand sluggish overseas economies.
Data Thursday may show U.S. unemployment dropped in June, supporting the case for higher interest rates.