Asian markets were mixed yesterday Thursday August 16, with Tokyo the best performer as the yen weakened against the dollar owing to dimming expectations of fresh monetary easing by the US Federal Reserve.
With few catalysts to drive action during the holiday season, trade was light, although shares were kept buoyant by lingering hopes for a restart of sovereign bond-buying by the European Central Bank and new stimulus in China. Wall Street provided very little direction for Asian traders.
Tokyo stocks jumped 1.88 per cent to close at a six-week high as improved US economic data fuelled investors’ risk appetite while a weaker yen also provided a boost.
The benchmark Nikkei 225 Index gained 167.72 to 9,092.76, its best finish since July 4. The broader Topix index of all first-section issues rose 1.58 per cent, or 11.80 points, to 759.12.
A stock dealer at a major Japanese brokerage said: “Investors are unwinding their short positions on oversold stocks such as electronics companies and steelmakers.”
Chinese shares closed down 0.32 per cent. The benchmark Shanghai Composite Index slid 6.75 points to 2,112.20.
“The recent lacklustre market performance and the continued economic downturn disappointed investors,” Zhang Qi, an analyst at Haitong Securities, said.
Sydney climbed 1.14 per cent, or 49.0 points, to 4,330.2 and Seoul closed flat, adding 0.95 points, to 1,957.91.
HONG KONG: STOCKS fell 0.45 per cent yesterday, a second straight loss. The benchmark Hang Seng Index slipped 89.34 points to end at 19,962.95.
The index was hurt by a five per cent dive in China Mobile to HK$86.85. The telco alone cost the index 90 points.
“It’s a given that earnings for Chinese companies are going to be bad, but the prospects for recovery are not so clear,” said Larry Jiang, chief investment strategist at Guotai Junan International Securities.
He said investors will reward companies with better earnings visibility, even if their shares have outperformed to date.
SINGAPORE: SOUTHEAST Asian stock markets were mixed yesterday with Singapore eking out slim gains led by commodities stocks such as Noble Group Ltd.
The benchmark Straits Times Index ended flat, edging up 0.78 points to 3,062.89.
Oil prices, which steadied near three-month highs, were supportive to sentiment in commodities but the broader market remained fragile due to worries about the global economy.
Noble Group and Wilmar International Ltd each advanced more than 2 per cent.
KUALA LUMPUR: BURSA Malaysia closed mixed yesterday in tandem with the softer regional markets as investors adopted a wait-and-see attitude, dealers said. .
They said the investors were also awaiting more clues by policymakers to boost global economic growth The benchmark FBM KLCI fell 3.69 points to 1,650.09.
Vice president and head of retail research, Affin Investment Bank, Dr Nazri Khan, said the FBM KLCI’s underlying trend will remain firm in the near term with the next target at 1,660, to be largely driven by large-capitalised and quality defensive stocks.
“The index ‘s underlying trend remains upbeat ahead of Budget 2013 and positive corporate results as well as the better-than-expected growth in Malaysia’s second quarter gross domestic product,” he said
In other markets:
* Taipei rose 0.30 per cent, or 22.47 points, to 7,490.21.
* Manila fell 0.90 per cent, or 47.15 points, to 5,219.51.
* Jakarta rose 0.45 per cent, or 18.52 points, to 4,160.51.
* Bangkok dipped 0.20 per cent, or 2.43 points, to 1,224.40.
* Mumbai’s Sensex index fell 0.40 per cent or 70.99 points to 17,657.21.
VIETNAM: Vietnamese shares on the primary bourse continued to close marginally up today as heavy weighs outperformed, but stocks on the smaller cap bourse fell on caution, liquidity shrank.
The benchmark VN Index added 0.06 point or 0.01% to 430.83, just enough to be in the green. Volume fell further by 32.5% to 26.76 million shares worth of VND488.19 billion. Put through trading contributed 2.54 million shares worth of VND69.16 billion.
The VN30 lost 1.58 points or 0.31%, to 514.47. Amongst its 30 members, 5 gained, 18 lost and 7 unchanged.
On the Hanoi Stock Exchange, the HNX bucked trend, falling further 0.21 point or 0.3% to 69.94. Trading volume edged up 2.1% to 33.87 million shares worth VND315.69 billion.
The market breadth was negative where 79 rallied, 109 declined, 87 closed unmoved, the rest untraded.
HNX30 lost 0.54 point or 0.4% to 133.39.
EUROPE: European shares stalled yesterday following a rally that has taken equity markets close to 2012 highs on expectations central banks will take action to boost flagging growth.
By 1041 GMT, the FTSEurofirst 300 was down 1.5 points, or 0.1 per cent, at 1,099.28, with trading volumes at barely 20 per cent of their 90-day average.
London’s benchmark FTSE 100 index of leading companies fell 0.15 per cent to 5,824.41 points in late morning trade, Frankfurt’s DAX 30 eased 0.04 per cent to 6,944.27 points and in Paris the CAC 40 shed 0.11 per cent to 3,445.55.
“It is indeed a very quiet summer market, with volumes significantly down and trading struggling to gain traction,” said Gekko Global Markets sales trader Anita Paluch.
AMERICA: Encouraging earnings from Cisco and hopeful signs in a housing report lifted the stock market Thursday. The gains nudged the Standard & Poor’s 500 index near the four-year high it reached earlier this year.
Cisco Systems, the world’s largest maker of computer networking equipment, led the 30 stocks in the Dow Jones industrial average, surging 10 percent. Cisco beat profit expectations late Wednesday and raised its quarterly dividend to 14 cents per share from 8 cents. Cisco gained $1.67 to $19.02.
Before the market opened Thursday, the Commerce Department reported that construction of single-family homes and apartments dipped 1.1 percent in July compared with June.
But market analysts seized on another number: Building permits jumped to 812,000, the most since August 2008 and a hint of stronger construction in coming months.
The report helped push the S&P and Dow near their highest closing levels since 2007.
The Standard & Poor’s 500 index gained 9.98 points to close at 1,415.51, less than four points shy of its April 2 high. The Dow rose 85.33 points to 13,250.11, an increase of 0.6 percent and 29 points away from its May 1 peak of 13,279.
Wal-Mart Stores trailed other Dow stocks. The world’s largest retail chain sank 3 percent after it posted quarterly net income and sales that fell short of what analysts had predicted. Its stock lost $2.30 to $72.15.
In other trading, the Nasdaq composite index rose 31.46 points to 3,062.39.
Facebook fell 6 percent on the first day that its early investors and a handful of founders were free to sell their stock. In all, 271 million shares can be sold, according to Facebook’s regulatory filings. The social networking company lost $1.33 to $19.87.
The S&P 500 has rallied more than 5 percent in the last three weeks, with the bulk of the gains made on a few days in late July and early August. The first jolt was a pledge to protect the euro currency by the head of the European Central Bank, the second a report that showed stronger-than-expected U.S. hiring last month.
Steve Wood, chief market strategist for Russell Investments, said the stock market may simply tread water until the end of the month, when Federal Reserve Chairman Ben Bernanke gives a speech at Jackson Hole, Wyo. Investors expect Bernanke’s speech will clarify whether the Fed plans to take additional steps to help the economy.
Markets often languish in August. Fewer shares are traded in late summer as trading desks remain short-staffed until people return from vacation after the Labor Day holiday. Without any major economic news, trading volume usually dries up and stock indexes appear sluggish, as if stuck in their beach chairs.
On Thursday, about 3.1 billion shares were traded on the New York Stock Exchange. Three months ago, daily trading volume on the NYSE averaged 3.8 billion.
The housing report also helped push the price of crude oil up $1.27 per barrel to $95.60 in New York. It has risen almost 3 percent in less than a week.
Among other stocks making big moves Thursday:
- Agilent Technologies slid 8 percent, the worst drop in the S&P 500. Agilent said a slump in global demand for its high-tech measuring products helped tug net income down 26 percent. Its stock lost $3.33 to $37.15.
- PetSmart Inc. climbed nearly 5 percent after the pet products store posted better earnings than analysts’ forecasts. PetSmart’s quarterly net income rose 28 percent, and it raised its annual profit forecast for the second time this year. The company’s stock added $3.09 to $70.53.
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