The Tokyo stock exchange started the month of August with a solid gain on Monday. Investors brushed aside concerns about the continued rise in the number of corona infections in Japan. Instead, they took advantage of several corporate solid results and further growth of the Japanese industry.
Disappointing growth figures for Chinese industry also fueled hopes of new stimulus from Beijing for the world’s second-largest economy.
Japan’s main index, the Nikkei 225, finished 1.8 percent higher at 27,781.02 points. On Friday, the indicator closed at its lowest level since early January. Final figures from market researchers Caixin and Markit showed that Japan’s manufacturing industry activity increased for the sixth straight month in July.
Japanese electronics company NEC gained almost 4 percent after a surprising profit in the past quarter. Auto parts maker Denso (plus 5 percent) also continued its rise thanks to better-than-expected results. In contrast, Japanese railway companies West Japan Railway, East Japan Railway, and Central Japan Railway fell to more than 4 percent after disappointing results due to the continuing impact of the corona pandemic on the sector.
The stock market indicator in Shanghai was up 1.7 percent in the meantime, and the Hang Seng index in Hong Kong gained 1 percent. According to Caixin and Markit, Chinese manufacturing activity grew only slightly in July. Last weekend, figures from the Chinese government already showed that the sector’s growth fell last month compared to June. The industry in China is struggling with high raw material prices, chip shortages, and disruptions in the global supply chain, among other things.
The All Ordinaries in Sydney gained 1.3 percent. Afterpay became worth 20 percent more. American fintech firm Square is looking to acquire the Australian buy now pay later company for $29 billion. Jack Dorsey’s company, which is also CEO and co-founder of Twitter, is paying for the acquisition entirely in Square stock.
With the Afterpay app, customers can buy products in web stores and pay for them upon receipt. The app has become popular as consumers increasingly shop online due to the corona pandemic. Especially young people who do not have a credit card use the app.