Asian markets mixed as Reuters Tankan survey show confidence of Japanese manufacturers at a six-month high
Japan’s retailers' sentiment and service-sector index both declined in October, according to the Reuters Tankan survey Reuters

While Asian stock market indices were trading mixed on Monday (17 October), the Shanghai Composite was down 0.72% at 3,041.62 as of 6.37am GMT. This followed the Reuters Tankan survey showing an improvement in the confidence of Japanese manufacturers.

The monthly Reuters Tankan survey, which correlates with the Bank of Japan's quarterly Tankan survey, was published on Monday. Its October manufacturers' sentiment index came in at +10. This was higher than September's +5 and marked a six-month high.

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The survey that polled 532 firms, of which 265 responded, said that this increase in confidence was driven by companies operating in the materials and food-processing industry. They are said to have benefitted from lower commodity prices and lower import costs amid the increase in the value of the yen. On the downside, the survey that was conducted between 28 September and 12 October said, that the manufacturers' sentiment was expected to drop to zero over the next three months.

Another element of this survey was the service-sector index, which is a barometer for private consumption that makes up for about 60% of the Japanese economy. This came in at +9 for October. This reading was not only down for a second straight month but it also marked a three and a half year low. On the positive, the survey said it expected this index to bounce back to +22 in January 2017.

According to the survey, Japan's retailers' sentiment also declined in October. The reading came in at -16, marking the lowest levels since February 2015. "Sales have been stagnant due to the typhoons that hit in August and September and a prolonged period of rainy days," an unnamed manager of a retailing business was quoted by Reuters as saying in the survey.

Indices in the region were trading as follows at 7.09am GMT:

Country

Index

Price

Up/Down

%Change

Hong Kong

Hang Seng Index

23,052.75

Down

0.78%

Japan

Nikkei 225

16,900.12

Up

0.26%

South Korea

KOSPI

2,027.61

Up

0.24%

India

CNX Nifty

8,527.30

Down

0.65%

Australia

S&P/ASX 200

5,388.70

Down

0.83%

Last week (14 October), the FTSE 100 closed 0.51% higher at 7,013.55, while the Dow Jones Industrial Average closed higher by 0.22% at 18,138.38.

Among commodities, oil prices were trading lower. While WTI crude oil was trading lower by 0.48% at $50.11 (£41.11) a barrel, Brent crude was trading 0.38% lower at $51.75 a barrel as of 7.13am GMT.