Asian Markets Flat as Weak Factory Data and Inflation Reports Weigh

Regional Equities Pause Ahead of Key U.S. Data

Most Asian stock markets saw little movement on Wednesday as investors absorbed mixed economic signals. Weak factory activity in Japan and China, alongside Australia’s Q1 CPI report, left regional bourses broadly muted. India slipped on renewed India–Pakistan tensions, while South Korea’s markets retreated amid domestic political unrest.

Factory Slowdown in China and Japan

China’s official manufacturing PMI dipped to 49.0 in April (from 50.5 in March), marking its first contraction since December 2023. The Caixin PMI likewise fell, driven by a sharp drop in overseas orders after the U.S. imposed steep tariffs—now totaling 145% on various Chinese goods.

In Japan, industrial production fell 1.1% month-on-month in March, exceeding forecasts for a 0.5% decline. Supply-chain disruptions in auto parts—amid a 25% tariff on vehicle imports and a temporary 10% levy on other Japanese goods—contributed to the slowdown.

Despite these headwinds, Hong Kong’s Hang Seng added 0.3%, while mainland Chinese indices held flat. Japan’s TOPIX jumped 0.4% as markets reopened after a holiday.

Australian Inflation Eases, Rate-Cut Odds Rise

Australia’s Q1 CPI data showed headline inflation slightly above expectations, but underlying price growth returned to the RBA’s 2–3% target band. This has bolstered market bets on a 25-basis-point rate cut at the May 20 meeting.

Eyes on U.S. PCE and Mega-Cap Earnings

Globally, investors are gearing up for the Personal Consumption Expenditures (PCE) price index release—a key Federal Reserve gauge—and a slate of mega-cap earnings. Traders tracking these events can seamlessly financialmodelingprep.com/developer/docs#economics-calendar-economics-data">Economics Calendar API, ensuring they capture every market-moving report without missing a beat.