Asia Stocks Mixed; Japan Yields Swing on BOJ: Markets Wrap

Asian stock markets were mixed on Friday, though the regional share gauge still headed to cap the strongest week since early June, following a series of steps by China shifting to stimulus mode.

Japanese equities climbed for a fourth day, shrugging off a decline in Nomura Holdings Inc. following a profit slide. Intensifying speculation about tweaks to the Bank of Japan’s stimulus program saw 10-year yields briefly trading above 0.1 percent -- against the BOJ target of about zero -- before slipping as the central bank said it offered to buy bonds. Stock indexes in China and Hong Kong ticked lower, with the offshore yuan bouncing off its weakest level in more than a year. The dollar held its advance and Treasury yields remained below 3 percent.

Central bank policy is back at the forefront of market discussions. China’s onshore currency is heading for a sixth straight week of declines as the People’s Bank of China continues to embrace faster liquidity and credit growth. The PBOC told some banks this week that a specific capital requirement will be eased to support lending, Bloomberg News reported.

The European Central Bank said Thursday it will stick to its plan to end bond purchases and pledged to keep interest rates unchanged “at least through the summer of 2019.” In Japan, reports suggest officials are debating ways to reduce the side effects of their yield-curve control policy.

Elsewhere, West Texas crude held gains after an attack on Saudi tankers stoked supply concerns. The Turkish lira took another beating Thursday after Trump threatened sanctions if the nation doesn’t release an American pastor.

Here are some key events still to come during the remainder of this week:

Earnings season continues with Twitter on Friday. U.S. gross domestic product probably increased by about 4.2 percent at an annualized rate in the second quarter, the most since 2014, economists forecast ahead of Friday’s data.

These are the main moves in markets: Stocks

Japan’s Topix index advanced 0.4 percent as of 2:03 p.m. in Tokyo. Hong Kong’s Hang Seng fell less than 0.1 percent. The Shanghai Composite was little changed after reversing losses. Australia’s S&P/ASX 200 Index gained 0.8 percent. South Korea’s Kospi index added 0.1 percent. Futures on the S&P 500 Index were flat. The underlying gauge dropped 0.3 percent Thursday.

Currencies

The yen gained 0.1 percent to 111.10 per dollar. The offshore yuan was steady at 6.8179 per dollar, after sliding 1 percent Thursday. The Bloomberg Dollar Spot Index rose 0.5 percent Thursday, the largest advance in two weeks. It edged down 0.1 percent Friday. The euro bought $1.1648.

Bonds

The yield on 10-year Treasuries held at 2.98 percent, heading for the biggest weekly rise since mid-May. 10-year Japan government bond yields rose to 0.1 percent, before paring that gain to trade at 0.09 percent.