Asia Mostly Higher on Hopes of Further Fed Action

This is a transcript of top stories presented by China's CCTV Business Channel as produced by CNBC Asia Pacific.

Hello and good evening.

You're watching Asia Market Daily, co-produced by CCTV Business Channel and CNBC, first in business worldwide.

I'm Saijal Patel and here are the top stories across Asia this Monday.

Stocks in Asia were mixed in Monday trade, even as the latest report on U.S. jobs failed to inspire the markets.

It also added to the view that the Federal Reserve may be forced to do more to help the recovery along.

Remember that on Friday we saw July non-farm payrolls falling 131,000, while the jobless rate remained at 9.5-percent.

James White, Analyst at Colonial First State Global Asset Management, discusses the implications behind the latest reading of the numbers.

(SOT)James White, Analyst at Colonial First State Global Asset Management:

“I think we heard last week that Ben Bernanke was relatively upbeat about what was happening in the US economy at the moment, but certainly the jobs number on Friday would have given him cause for concern . I think the real danger in the jobs number that we saw on Friday is that state governments in the US are really starting to make some efforts to get their balances back on track as a result, we're starting to see some unemployment in the government sector, a sector that we probably wouldn't expect to see at a time when the economy does need some support.”

Let's break down the market action now.

Japan's Nikkei 225 was hit once again by the yen's strength against the dollar, as that weak outlook on the U.S. economy took its toll.

The benchmark index closed down 0.7 percent.

In South Korea, shares pared their earlier losses.

The KOSPI closed higher by 0.4 percent.

In Australia, the S&P ASX 200 higher by 0.6 percent.

Shares of AXA Asia Pacific closed higher by 5.4 percent, after lender NAB revised its bid for the company.

This is as Australia's competition regulator agreed to reconsider NAB's proposed 12-billion-dollar takeover.

NAB has offered to sell AXA's north retail investment platform to alleviate competition concerns and to save the deal.

The regulator has given market participants until August 23rd to come back with comments.

It said it will decide whether to accept or reject the deal by September 9th.

Meantime in Hong Kong, traders are waiting on the sidelines ahead of key economic data from China and central bank meetings in Japan and the U.S.

China's Shanghai Composite closed 0.5 percent higher.

Chinese steel and cement stocks rose, after the government on Sunday ordered more than 2-thousand companies in 18 industries to shut down obsolete plants.

The decision is expected to streamline these industries, where overcapacity is a problem.

And in some of the corporate news we're watching.

China Everbright Bank has set a lower-than-expected price range for its 3-billion dollar Shanghai IPO.

That's despite getting guarantees from key investors to buy the bulk of the shares.

The midsized bank said the IPO was 17-times oversubscribed by institutional investors.

The shares are priced between 2-85 and 3-10 renminbi each.

Final pricing is expected by Wednesday and the listing is on August 18th.

This IPO will be China's second-largest this year.

Francis Lun, General Manager of Fullbright Securities, gives his take on why the IPO range came in lower than most had thought.

(SOT) Francis Lun, General Manager of Fullbright Securities:

“I think it has to do with the decline in bank shares recently, also because of the central banks' stress test on commercial banks. The central bank wants the banks to make assumptions that the property prices will fall 60%, and see how can they stand up to the stress test and I think that brings bank shares down. And that's why China Everbright bank has to settle for a lower price because under these conditions they won't be able to sell their shares at 2 times for value but they have to settle for a lower valuation.”

There's a lot of key events the markets will be watching this week.

Among them is the busy calendar for Chinese economic data.

We're expecting some key economic data, starting with trade-numbers and property investment-and-prices on Tuesday.

On Wednesday we'll get inflation-numbers from the producer and consumer fronts.

Here's what independent economic strategist Chi Lo expects.

(SOT) Chi Lo, Independent Economic Strategist:

“On the inflation front, I think we are still likely to see a benign picture, although there may be a slight pick up this month inflation rate. The reason being, basically, it's a base effect. I don't see any significant forces that's going to push up Chinese inflation significantly higher in the coming month. so going forward, I think next year, or the second half of this year going to next year, I don't think we're going to see any significant policy changes either, so we will see sort of a calm period going forward unless something major happens outside China.”

Meantime, central banks also on the radar.

The Bank of Japan begins its two-day policy meeting today.

And although no change is expected in terms of policy tomorrow, we're watching on whether the BOJ is ready to pull the trigger if the yen soars to an all-time high against the dollar, and threaten the fragile economic recovery.

Naomi Fink, Japan Strategist at Bank of Tokyo Mitsubishi, shares what she thinks would be the most significant take-away from the meeting.

(SOT) Naomi Fink, Japan Strategist at Bank of Tokyo Mitsubishi:

“The BOJ until now has signaled two-sided risks, so first we have the potential downturn in external growth, if we actually do see export demands taper off but then on the other hand, it signaled as a significant upside risk, healthy demand in emerging markets, including China's. And what we see alongside that rising commodity prices, and then China rising prices in general. I suppose we'll see that later this week in China's CPI. So I don't really see too much scope for the BOJ to move yen or yen's strength or no.”

Meantime, a recent deluge of soft economic data, including that weak jobs report for July, suggests the Fed may announce fresh measures to support a flagging recovery.

There is talk that some form of quantitative easing might also be on the cards.

(SOT) John Noonan, Senior FX Analyst, Thomson Reuters:

“The burden is on the Fed and there's a belief in the market now that, almost discounting the fact, that the Fed will do what they call QE light, which will be just recycling the process from the maturing mortgage back securities back into the bond market in one form or another. Goldman Sachs is suggesting they might buy treasuries, so that is going to be the focus this week. One of the reasons the market did rebound a little bit at the end of the day on Friday, there were quite a few people though, feel that there's a very close call that the Fed may hold off and not do anything. I think that would probably disappoint the markets.”

Well, that wraps up today's business highlights.

I'm Saijal Patel from CNBC.

See you again tomorrow.

All Rights Reserved. A Division of NBC Universal.