BEIJING: Shares in Shanghai traded higher Monday, lifting some markets in Asia, although investors were nervous that China’s mainland market remained a potential source of volatility for the region.
The Shanghai Composite was last up 1.6%, as mainland markets reopened after a long weekend. The Nikkei Stock Average was up 0.8% and Korea’s Kospi was up 0.4%.
Currencies were under pressure with the Malaysian ringgit and Singaporean dollar hitting fresh lows earlier, after the U.S. jobs report failed to provide much clarity on when the U.S. Federal Reserve will raise short-term interest rates. Higher interest rates in the U.S. are likely to give the dollar a boost, as they make the currency more attractive to yield-seeking investors.
“Trading in Asia today will be driven by two major factors: The delayed response to Friday’s nonfarm payrolls (NFP) number out of the U.S. and the reopening of the Chinese stocks markets after a four-day break,” said Angus Nicholson, market analyst at IG in a morning note. Markets in China were closed for a national holiday on Thursday and Friday.
Worries about higher U.S. interest rates are adding to fears that China’s market, down nearly 40% from its peak in June, is signaling a worse slowdown in China’s economy than investors had thought. Last week, the Nikkei Stock Average fell 7%, the worst performing stock benchmark in Asia. China shares came out relatively unscathed last week, helped by a shortened trading week and government-led stocks buying.
