FRANCE: Asian stocks edged higher on Tuesday after a six-day losing streak and the dollar firmed against the safe-haven Japanese yen, but gains were muted ahead of Chinese data which could offer more clues on the health of its economy.
Chinese trade data at 0200 GMT is likely to show a further contraction in both imports and exports in August and point to a continued economic slowdown, but are not expected to offer any signs of a hard landing which some global investors have begun to fear.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.2 percent in early trade but remained near a three-year low hit two weeks ago.
U.S. stock futures ESc1 rose 0.9 percent after a long holiday weekend, catching up to gains in Europe on Monday.
“With the U.S. markets closed on Monday, risks emanating from China will be the main currency driver. Shanghai stocks will be in focus and especially how China’s trade data affects sentiment there,” said Junichi Ishikawa, market analyst at IG Securities in Tokyo.
Japan’s Nikkei .N225 slipped 0.3 percent, extending its rebound from a seven-month low hit early on Monday while Australia rose 1 percent in early trades.
Chinese stocks .SSEC opened slightly lower before climbing back into positive territory, while Hong Kong edged higher.
Highlighting the growing concerns about economic stability and capital outflows from China, its foreign exchange reserves fell by a record $94 billion in August as the central bank struggled to steady the yuan after its surprise devaluation.
Adjusted for currency revaluation effects, Nomura strategists reckon the decline in reserves was more likely around $129 billion. That comes after a 2.6 percent monthly drop in the value of the yuan againstthe U.S. dollar, and raised doubts about how long China can continue supporting the yuan at current levels if the economy continues to cool.
