Asia report: Markets mostly fall, China pops ahead of conference

(Sharecast News) - Asia-Pacific markets displayed a mixed performance on Friday, with Chinese stocks leading gains ahead of an anticipated policy meeting, while other regional markets tracked Wall Street's overnight decline.

Investors in Korea were meanwhile still reeling from a week of political turmoil, with opposition politicians aiming for a no-confidence vote in president Yoon Suk Yeol, after his declaration of martial law and apparent attempt to arrest his opponents earlier in the week.

"Risk in Asia declined on Friday amid renewed political tensions in South Korea, causing unease among investors ahead of the crucial US nonfarm payrolls report, which could affect expectations for a Federal Reserve rate cut this month," said TickMill's Patrick Munnelly.

"The potential for another martial law declaration in South Korea triggered substantial selling pressure on the Korean won and the Seoul stock market.

"The won fell by as much as 1%, while the Kospi index experienced a decrease of 1.8% at one point."

Munnelly noted that the Australian dollar, often viewed as a barometer of risk appetite, dropped by 0.5% at one point.

"In response to the situation, South Korean officials acted quickly, with dealers suggesting that the foreign exchange regulator likely intervened by selling US dollars to support the won.

"Authorities have committed to providing unlimited liquidity to stabilise the markets - a strategy that has proven effective so far.

"The commander of the country's special warfare unit alleviated concerns by announcing he would not accept any new orders for martial law."

Most markets in the red, mainland China a bright spot

Chinese equities surged as investors looked to the annual Central Economic Work Conference, expected next week.

The Shanghai Composite rose 1.05% to 3,404.08, and the Shenzhen Component climbed 1.47% to 10,791.34.

Gains in Shanghai were led by Jiangsu Jiangnan High Polymer Fiber, Liaoning Shenhua Holdings, and Hua Yuan Property, each up over 10%.

The meeting would see Chinese authorities outlining their 2025 economic targets, with hopes for additional stimulus to counter sluggish growth and the potential effect of US tariffs.

Hong Kong's Hang Seng Index echoed the optimism, rising 1.56% to 19,865.85, led higher by WuXi AppTec, up 9.2%, and Trip.com Group, which added 5.86%/

Japan's Nikkei 225 fell 0.77% to 39,091.17, weighed down by losses in industrial stocks like Japan Steel Works, which slid 4.3%.

The broader Topix index also dropped 0.55%.

In South Korea, the Kospi 100 was off 0.54% to 2,433.40.

Korea Zinc led the declines, plummeting 9.35%, followed by losses of 6.64% in Kogas.

Australia's S&P/ASX 200 lost 0.64% to 8,420.90, with Iluka Resources down 10.04% and Magellan Financial Group off 8.62% by the end of trading in Sydney.

New Zealand's S&P/NZX 50 mirrored the region's downward trend, falling 0.68% to 12,809.59.

Sky Network Television and Freightways were among the top laggards in Wellington.

In currency markets, the dollar was last up 0.31% on the yen, trading at JPY 150.56, as it gained 0.5% against the Aussie to AUD 1.5575, and advanced 0.66% on the Kiwi, changing hands at NZD 1.7103.

Oil prices continued to decline, with Brent crude futures last down 1.01% on ICE at $71.36 per barrel, and the NYMEX quote for West Texas Intermediate dropping 1.04% to $67.59.

Household spending in Japan declines for third month

In economic news, Japan's household spending continued its downward trend in October, falling 1.3% year-on-year, marking the third consecutive month of declines.

The drop was largely attributed to weaker sales of fall and winter clothing, as unusually warm weather reduced demand for seasonal apparel.

According to data from the Ministry of Internal Affairs, households of two or more people spent an average of JPY 305,819 after adjusting for inflation.

Spending on clothing, including business suits and coats, saw a significant 18.4% decrease.

Food spending also showed signs of caution, with a 0.8% dip, reflecting consumers' continued focus on budgeting.

Specific categories such as meat, fruit, and confectionery saw declines of 4.6%, 3.6%, and 3%, respectively.

On the other hand, utility costs rose, with household spending on electricity up 16.3% and gas increasing by 4.9%.

Reporting by Josh White for Sharecast.com.