Asian markets mixed; BoJ announces modest stimulus expansion

Bank of Japan (BoJ)

MANILA, Philippines—Asian markets were mixed Friday after the Bank of Japan announced a modest expansion of its lavish monetary stimulus to perk up sluggish growth, disappointing markets and sending the Japanese stock index only slightly higher.

Keeping score: Japan’s Nikkei 225 gained 0.6 per cent to 16,569.27, recovering from earlier losses. Hong Kong’s Hang Seng index fell 1.3 per cent to 21,878.15. Australia’s S&P ASX 200 rose 0.1 per cent to 5,560.40. China’s Shanghai Composite Index slipped 0.5 per cent to 2,979.34 and South Korea’s Kospi slid 0.2 per cent to 2,016.19. In Southeast Asia, Indonesia and Malaysia rose, but Singapore and the Philippines fell.

Japan-economy: Japan’s central bank ended a policy meeting Friday by announcing it will expand purchases of exchange traded funds from financial institutions to help inject more cash into the world’s third-largest economy and pursue its 2 per cent inflation target. But the measures fell short of expectations among many investors for more aggressive action.

Analyst viewpoint: “After much anticipation Japan has announced more monetary and fiscal stimulus. However, the Bank of Japan has underwhelmed with just a doubling of its of ETF buying program … but no increase in its bond buying program or monetary base target, suggesting no real further easing of monetary policy,” said Shane Oliver, head of investment strategy and chief economist of AMP Capital, referring to exchange-traded funds.

Wall Street: Stocks had another day of meagre gains on Thursday as investors worked through a new batch of mixed company earnings, including results from Facebook, Ford and Whole Foods. The Dow Jones industrial average lost 15.82 points, or 0.1 per cent, to 18,456.35. Standard & Poor’s 500 index rose 3.48 points, or 0.2 per cent, to 2,170.06 and the Nasdaq composite rose 15.17 points, or 0.3 per cent, to 5,154.98. Market strategists say stocks have gotten expensive in recent days, and many investors are waiting for earnings to play out before making any major moves.

Currencies: In currencies, the dollar fell to 103.64 yen after closing at 104.79 yen on Thursday. The euro rose to $1.1089 from $1.1081 from the previous day.

Oil: In the energy market, benchmark U.S. crude lost 26 cents to $40.88 on the New York Mercantile Exchange. It fell 78 cents to close at $41.14 a barrel on Thursday. Brent crude, used to price international oils, fell 32 cents to $42.91 in London. It settled at $43.23 the previous day.