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Asian shares steady after slew of data paints mixed economic picture

Published 07/09/2014, 10:35 PM
Updated 07/09/2014, 10:37 PM
Australian shares flat
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Investing.com - Asian stocks markets were calm after the Federal Reserve signaled the date of its exit from quantitative easing and as mixed economic data in the region pointed to the possibility of continued easy policy in Australia, Japan and China.

In Japan, the corporate good price index for June rose 4.6%, comapred to a 0.1% increase expected month-on-month, core machinery orders for May slumped 19.5%, compared to a gain of 0.7% month-on-month expected and the tertiary activity index rose 0.9%, compared to a 1.9% gain seen month-on-month.

In Australia comes MI inflation expectations came in at an annual timmed mean of 3.8% for July. The private survey was followed by a gain of 15,900 jobs in June, above expectations of a gain of 12,000 jobs, while the unemployment rate nudged up to 6.0% from 5.9% expected.

China trade data for June showed exports rose 7.2%, compared with expectations for a gain of 10.6% and imports increased 5.5%, compared to an expectation of 5.8%.

Japanese stocks were broadly flat, with the Nikkei 225 down 0.1% and South Korea's KOSPI up 0.2% after the Bank of Korea held rates steady.

The S&P/ASX 200 was also flat.

Overnight, U.S. stocks rose after the Federal Reserve said it would likely close its stimulus program at the end of this year, a sign the economy is improving.

The Dow 30 rose 0.47%, the S&P 500 index rose 0.46%, while the NASDAQ Composite index rose 0.63%.

The economy continues to improve and will stand on its own two feet without the support of monetary stimulus programs within a few months, markets concluded after digesting the minutes of the Federal Reserve's June policy meeting.

The Fed is currently buying $35 billion in Treasury and mortgage debt a month to spur recovery, a monetary policy tool known as quantitative easing that aims to stimulate the economy by suppressing long-term interest rates.

The stimulus program aims to entice investors out of safe-haven asset classes like the U.S. dollar and into equities with the hope investing and hiring follow.

The Fed has gradually been trimming the amount of bonds it purchases by $10 billion a month, and by end of this year, the program should close if the Fed continues to taper on its current trajectory.

Expect that final cut to come in October if recovery continues at its current pace.

On Thursday, the U.S. is to release the weekly government report on initial jobless claims.

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