HONG KONG - Asian stocks were mixed on Monday following a retreat on Wall Street as investors assessed fresh data that tempered expectations for a US interest rate hike but indicated weakness in the world's top economy.
Hopes that the Federal Reserve will not tighten policy next month boosted equities last week -- pushing the S&P 500 and Nasdaq to records -- as closely watched reports pointed to a softening labour market and inflation easing, even if it is still well above target.
The moves suggested that traders were taking the "bad news is good news" approach, but figures on Friday raised questions about the health of the economy and led observers to warn that investors should be careful what they wish for.
Retail sales fell 0.6 percent on-month in July, the worst performance in more than a year, while consumer sentiment plunged as households battered by fallout from President Donald Trump's Iran war curbed spending and raised their expectations of inflation.
Payrolls data at the start of the month "was followed by broadly in-line inflation, softer retail sales and weaker consumer sentiment", said Fawad Razaqzada at Forex.com.
Hong Kong was lifted by tech giants Alibaba, Tencent and JD.com, while Shanghai and Taipei were also up.
Tokyo was flat, though chipmaker Kioxia gained more than five percent, while SoftBank, Advantest and Tokyo Electron added between 1.3 and two percent. There appeared little major reaction to data showing Japan's economic growth fell short of forecasts in the second quarter.
Sydney, Singapore, Wellington and Manila edged down.
The dollar held losses against its peers after dropping on Friday in reaction to the latest data.
Oil prices extended Friday's one-percent gains with the US and Iran continuing to snipe at each other and showing no signs of reaching a deal to reopen the Strait of Hormuz.
- AFP