Asian stocks trade lower, European stock markets are set to open mixed ahead of Eurozone GDP, CPI data

• Asian equities trade in negative territory after the downbeat Chinese data and BoJ rate decision.
• China’s Manufacturing PMI eased to 49.5 in October vs. 50.2 prior, Services PMI dropped to 50.6 in October versus 51.7 prior.
• Bank of Japan (BoJ) kept the rate unchanged, decided to make YCC more flexible.
• European stock markets head to open mixed ahead of Eurozone data.

Most Asian stocks traded lower on Tuesday as Chinese PMI data came in worse than expected while the Bank of Japan (BoJ) tweaked its bond yield control policy following its October meeting. Markets might turn cautious ahead of the Federal Reserve (Fed) meeting on Wednesday.

The Federal Reserve (Fed) Chair Jerome Powell affirmed that the Fed would maintain the rate steady at its upcoming meeting. However, investors will take cues from the Fed officials’ comments during the Press Conference. The dovish stance of US policymakers might trigger volatility in riskier assets like stock markets.

China’s Shanghai was down 0.19% to 3,015, the Shenzhen Component Index dropped 0.90% to 9,838, Hong Kong’s Hang Sang fell 1.70% to 17,110, South Korea’s Kospi dropped 1.38%, India’s NIFTY 50 is down 0.16%, and Japan’s Nikkei is gain 0.16%.

The weaker-than-expected China’s Manufacturing Purchasing Managers’ Index (PMI) data exert some pressure on the Chinese equities. Earlier Tuesday, the nation’s Manufacturing PMI came in at 49.5 in October from 50.2 expansion in September, worse than the market expectation of 50.2. Meanwhile, NBS Services PMI dropped to 50.6 in October versus 51.7 prior, below the market consensus of 51.8.

In Japan, the Bank of Japan (BoJ) committee decided to keep the interest rate and 10-year Japanese Government Bond (JGB) yield target at -0.1% and 0% respectively, after its October meeting. Japanese central bank decided to make YCC more flexible and changed the language around the 1.0% 10-year JGB yield cap.

European stock markets are set to open mixed as investors await the top-tier data in the area, including German Retail Sales, the preliminary Eurozone inflation data, and Gross Domestic Products for the third quarter (Q3).

On Monday, the German growth number came in at 0.1% quarterly fall from 0% in the previous reading, slightly better than the 0.3% decline estimated. German Consumer Price Index (CPI) arrived at 3.8% YoY in October versus 4.5 prior. The figure registered the lowest since August 2021.

Looking ahead, market participants will keep an eye on German Retail Sales, Eurozone growth numbers, and CPI data on Tuesday. On the US docket, the Conference Board Consumer Confidence will be released. The attention this week will be on the Fed interest rate decision on Wednesday and the Bank of England (BoE) monetary policy meeting on Thursday.