Asia stocks end mixed in cautious trade; Nikkei closes down 0.2%

Investing.com - Asian stock markets ended mixed on Thursday, as investors remained cautious ahead of upcoming U.S. economic data and a policy meeting by the European Central Bank.

During late Asian trade, Australia’s ASX/200 Index closed 1.2% higher, Hong Kong’s Hang Seng Index advanced 0.55%, while Japan’s Nikkei 225 Index ended down 0.18%. In China, the Shanghai Composite Index reopened after the Lunar New Year holiday with a 0.8% decline.

Asia was given a negative lead from the U.S., where the Dow Jones Industrial Average and the S&P 500 ended lower after data painted a mixed picture of the U.S. economy.

The U.S. Institute of Supply Management said its non-manufacturing purchasing manager's index rose to 54.0 last month from a reading of 53.0 in December. Analysts had expected the index to ease up to 53.7 in January.

The data came after payroll processing firm ADP said non-farm private employment rose by a seasonally adjusted 175,000 last month, below expectations for an increase of 180,000.

While not viewed as a reliable guide for the government jobs report due on Friday, February 7, it does give guidance on private-sector hiring.

Market players now looked ahead to key U.S. economic data later in the day for further indications on the strength of the economy and the future course of monetary policy.

The U.S. is to publish the weekly report on initial jobless claims later in the day as well as data on the trade balance.

Investors will also be awaiting the outcome of the ECB’s policy meeting later Thursday.

While no policy change was expected from the central bank, many investors expected the ECB to signal the possibility of further monetary policy easing at its meeting in February.

In Tokyo, the Nikkei closed modestly lower as traders continued to monitor the yen’s movements.

USD/JPY fell to a session low of 101.31, holding close to a four-month trough of 100.76 hit earlier in the week. A stronger yen decreases the value of overseas income at Japanese companies when repatriated, reducing the outlook for export earnings.

Japanese megabanks were lower with shares of the nation’s largest lender Mitsubishi UFJ Financial Group falling 1%, while Sumitomo Mitsui Financial Group and Mizuho Financial Group retreated 1.4% and 1% respectively.

Meanwhile, in Australia, the ASX/200 Index bounced off the previous session’s seven-week low after data showed that retail sales there rose 0.5% in December, in line with expectations.

The news boosted shares in the retail sector, with David Jones shares rallying 1%, Myer Holdings rising 1.65%, while Wesfarmers and Woolworths picked up 2.7% and 2.4% respectively.

A separate report showed that the country’s trade surplus widened to AUD468 million in December from AUD83 million in November. Markets were instead expecting a trade deficit of AUD300 million.

The Big Four banks were mostly higher, with Commonwealth Banking Group and Australia and New Zealand Banking Group rising 1.4% apiece, while National Australia Bank added 1.5% and Westpac Banking Group tacked on 1.7%.

Elsewhere, in Hong Kong, the Hang Seng rebounded from the weakest level since July as investors returned to the market to seek cheap valuations in wake of recent losses.

Macau casino stocks were in demand, with Sands China soaring 10.7%, Wynn Macau climbing 3.3%, while MGM China and Galaxy Entertainment rallied 7.9% and 7.7%.

Looking ahead, European stock market futures pointed to a mildly higher open. The EURO STOXX 50 futures pointed to a gain of 0.3%, France’s CAC 40 futures added 0.4%, London’s FTSE 100 futures indicated a rise of 0.5%, while Germany's DAX futures picked up 0.45%.

Across the Atlantic, U.S. equity markets also pointed to a firmer open. The Dow Jones Industrial Average futures pointed to a gain of 0.1%, S&P 500 futures inched up 0.1%, while the Nasdaq 100 futures indicated a rise of 0.1%.