The Nikkei 225 Index rose 0.1% to close at 32,193 while the broader Topix Index gained 0.28% to 2,275 on Friday, with both benchmarks finishing the week lower as a wave of risk-off sentiment spread throughout the market during the period following a US credit rating downgrade and a strong run-up in US Treasury yields. Investors also continued to track the yen and JGB yields after the Bank of Japan made adjustments to its yield curve control policy at last week’s meeting. Notable gains were seen from index heavyweights on Friday such as Nippon Yusen (3.1%), Toyota Motor (1.3%), Mitsubishi UFJ (1.8%), SoftBank Group (0.7%) and Nippon Steel (1%). Meanwhile, Nintendo fell 2.9% even after reporting a surge in revenue and operating profit for the second quarter. Losses were also seen from Keyence (-0.4%), Renesas Electronics (-4%) and Fast Retailing (-0.3%).
The Shanghai Composite rose 0.23% to close at 3,288 while the Shenzhen Component gained 0.67% to 11,238 on Friday, with both benchmarks finishing higher for the second straight week, lifted by growing optimism that Chinese authorities would offer more pro-growth policy measures to support the economy. Investors also cheered data released this week showing Chinese services sector growth surprisingly accelerated in July, while manufacturing activity showed signs of improvement. Financial firms extended a rally as the Chinese government encouraged stock investing, with gains from Citic Securities (1.1%), The Pacific Securities (5.5%), Guolian Securities (3.4%), Caida Securities (1.5%) and Huatai Securities (3.6%). Other heavyweights stocks also posted notable gains, including Contemporary Amperex (2.7%), Inspur Electronic (5.7%) and China United Network (7.5%).
The BSE Sensex rebounded from a three-day losing streak and edged up 0.74% to 65,721 on Friday, after positive corporate results. HDFC Bank (1.5%) and ICICI Bank (0.6%) displayed double-digit net interest income growth for Q1, driven mostly by consistent loan growth. On the other hand, India's largest bank, State Bank of India, reported a near three-fold YoY growth in Q1 profit although its shares ended 2.9% lower. On the automotive industry, Mahindra And Mahindra profits almost doubled, led by a 22% revenue jump but the company's stock ended 0.4% lower. Despite Friday's recovery, the benchmark stock index in India fell 0.66% on the week, showing general risk-off sentiment.
All three major U.S. indexes closed in the red on Friday, as investors were digesting the latest corporate results and fresh job reports. The Dow pared its earlier gains and finished 148 points lower, while the S&P 500 and the Nasdaq 100 lost 0.5% and 0.3%, respectively, dragged by a 4.8% fall in share of Apple after disappointing quarterly results and outlook led its market cap to dip below $3 trillion. Also, bond yields fell as a mixed jobs report did little to alter bets on the outlook for Federal Reserve policy. The US economy added 187K jobs in June, missing market expectations of a 200K rise, but the unemployment rate unexpectedly fell to 3.5% and hourly earnings surpassed estimates at a 4.4% yearly growth. On the earnings front, Amazon (8.3%), Booking (7.8%), DraftKings (5.8%) and Dropbox (5.9%) gained on upbeat quarterly results. On the week, the Dow booked a 1.1% fall, while the S&P 500 and the Nasdaq 100 lost 2.3% and 2.8%% respectively.
