Asian stocks post modest gains as economic data is mixed for Japan and China

Asian stocks were mostly higher on Monday after Japan and China released data reflecting relatively slow growth for Asia's two largest economies.

The euro rose after the far right The National Rally takes a solid lead In the first round of the legislative elections, the Japanese yen fell, trading at around 161 yen to the dollar. US futures and oil prices rose.

Polling agencies suggest the National Rally could win a majority in the lower house of Parliament, but the outcome is uncertain and the voting system is complex.

The euro costs $1.0757, down from $1.0713.

U.S. futures and oil prices rose.

Japan's benchmark Nikkei 225 index gained 0.3% to 39,693.29 after a quarterly survey by the Bank of Japan, called a tankan, showed a slight improvement in confidence among the country's biggest manufacturers in the April-June quarter.

However, the government revised down its growth estimate for the first quarter of the year to an annual rate of minus 2.9%, from a previous figure of minus 1.8%.

Across all sectors and company sizes, business conditions remained stable at 12, which corresponds, according to past data, to quarterly GDP growth of around 0%, said Marcel Thieliant of Capital Economics when evaluating the tankan. A further slowdown in GDP growth this quarter would be consistent with the drop in industrial production that businesses were forecasting for June.

The Shanghai Composite Index climbed 0.3% to 2,976.64 after a survey of factory purchasing managers released over the weekend showed conditions remained in contraction for a second straight month.

But a similar survey of private sector manufacturing activity released Monday showed an improvement in business conditions. Caixin's manufacturing PMI rose to 51.8 in June on a scale of 100, up from 51.7 the previous month. Readings above 50 are considered to indicate expansion.

Hong Kong markets were closed for a public holiday.

The Australian S&P/ASX 200 index lost 0.3% to 7,744.20 points. South Korea's Kospi rose 0.2% to 2,802.87 points after a private sector survey showed the country's industrial activity was the best since April 2022.

A wave of late-day selling on Friday sent the S&P 500 down 0.4% to 5,460.48 and into the red for the week. The Nasdaq Composite fell 0.7% to 17,732.60, while the Dow Jones Industrial Average ended down 0.1% at 39,118.86.

Despite a pessimistic conclusion, the S&P 500 and the Nasdaq remain close to their all-time highs.

The S&P 500 gained 3.5% in June and is up about 14.5% year to date.

The Nasdaq gained about 6% for the month and is up 18.1% this year.

The decline in big technology stocks, which were the big winners in the market's record rally, weighed on the market on Friday. Apple fell 1.6%, Microsoft lost 1.3% and Meta Platforms ended down 3%.

The story continues

A report showed inflation continues to fallInvestors are hoping that slowing inflation will prompt the Federal Reserve to start cutting interest rates, which remain at their highest level in more than 20 years.

Consumer prices rose 2.6% in May from a year ago, according to the latest index of personal consumption expenditures, or PCE. That's a continuation of the easing from April's 2.7% reading and is well below the 7.1% peak two years ago.

Treasury yields rose in the bond market after initially losing ground on the latest signal of slowing inflation. The yield on the 10-year Treasury, which influences interest rates on mortgages and other consumer loans, rose to 4.38%. The yield on the two-year Treasury note, which more closely tracks expectations for Fed action, rose to 4.74% from 4.72% just before the data was released.

The Fed raised interest rates to their highest level in more than two decades in an effort to bring inflation back to its 2% target. Other measures of inflation, including the popular consumer price index, have also confirmed that price pressure has eased.

In energy trading, a barrel of American crude oil gained 39 cents to $81.93 on the New York Mercantile Exchange. A barrel of Brent, an international benchmark, gained 41 cents to $85.41.