Nikkei Jumps 2% on The OPEC Deal

This morning, Japan’s benchmark Nikkei surged more than two percent on the heels of sold manufacturing surveys out of China and upbeat sentiment following the recent OPEC deal to cut oil production. This is the first deal to cut production since 2008.

The Nikkei 225 jumped 2.25 percent, led by energy plays like Inpex which soared over ten percent, however close trading day at 1.12% up. Japan Petroleum Corporation rocketed nearly 13 percent and a weaker yen also boosted exporting plays. The USD/JPY Forex pair, as of 11:20 am HK time was trading at 114.35.

In Australia, the S&PASX 200 was up 1.10 percent as the energy sub-index recovered up nearly seven percent. The materials sub-index also went up 2.3 percent. Today’s economic data showed that business sentiment ell by four percent in the third quarter. Way worse than the expected 2.5 percent decline. This fall in investments will likely have an impact on the third quarter gross domestic product release on December 7.

Shares on the Chinese stock indices rose today as the Shanghai Composite rose 0.67 percent and the Shenzhen Composite rose 0.42 percent. Stocks on the Hang Seng Index rose 0.47 percent. This morning, China released its official manufacturing purchasing managers index (PMI) which rose to 51.7. This was above the expected 51.0. The Caixin/Markit Manufacturing PMI fell to 50.9. The number came in at 51.2 in October but beat expectations.

In Japan, the manufacturing PMI came in higher-than-expected in November at 51.3. Economists expected a print of 51.1. In South Korea data showed that the CPI rose by 1.3 percent, annually, but missed the expected 1.5 percent increase. Their target for inflation is two percent and this print leaves room for further monetary easing.

The news was positive for the South Korean Kospi which rose 0.2 percent. Other data, for South Korea, showed that their exports rose 2.7 percent, above the expected 1.2 percent. Imports jumped 10.1 percent, well above the expected 2.9 percent increase. Shipments to China also grew for the first time in 17 months.