Asia Pacific share market drifted lower on Thursday, 04 September 2014, as investors cashing out gain made recently amid a cautious mood ahead of the outcome of key European Central Bank (ECB) meet later in the global day and as US employment data due on Friday. The MSCI Asia Pacific Index dropped 0.2 % to 148.83.
The ECB will announce its monetary policy decision today. Some investors believe the ECB meeting could result in new stimulus measures for the eurozone economy. Last month ECB president Mario Draghi flagged the possible commencement of quantitative easing-style stimulus.
The European Central Bank emphasized the need to fight deflation and ignite growth at a symposium in Jackson Hole, Wyoming, last month. Disappointing economic data only raised the likelihood.
The Bank of England was also due to meet on Thursday night, with a status quo outcome predicted.
The Bank of Japan maintained its plan for a 60 trillion yen to 70 trillion yen ($668 billion) annual increase in its monetary base at the end of its two-day meeting, while also providing a more upbeat view of the economy. Meanwhile, the central bank also expected the negative impact of the tax hike to "wane gradually".
Among Asian bourses
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Nikkei drops 0.33% from eight -month high
Japanese share market closed lower in relatively quiet trade, registering first drop in four consecutive sessions. The decline came as investors booked profits after the Bank of Japan kept its policy unchanged and on caution before a European Central Bank meeting later on the global day. The benchmark Nikkei 225 index declined 0.33%, or 52.17 points, to finish at 15676.18, snapping three days of winning streak. The Topix index of all first-section shares dropped 0.39%, or 5.13 points, to 1296.39.
NHK Spring sank 2.3% to 996 yen after saying it will sell $100 million worth of five-year convertible bonds in overseas markets.
Shinsei Bank climbed 1.8% to 225 yen. SMBC Nikko raised its rating on the stock to outperform from neutral, and boosted its share-price target to 320 yen from 260 yen.
Profit booking weighs down Aussie shares
Australian share market closed down, as investors booked profits amid caution about a Ukraine-Russia cease-fire plan and caution ahead of key European Central Bank meeting Thursday. Almost all sectors ended in red, with shares of technology, bullion, realty, financial and mining companies being major losers. The benchmark S&P/ASX 200 Index and the broader All Ordinaries Index each declined by 0.4% to 5631.30 points and 5632.10 points, respectively.
Materials and resources stocks declined, with resources giant BHP Billiton sliding 0.5% to A$36.02 and main rival Rio Tinto falling 0.3% at A$62.14 after spot iron ore hit a five-year low of US$85.70. Fortescue Metals rose 1.3% to A$4.05 after reiterating its goal of shipping 155-160 million metric tons of iron ore in fiscal year 2015.
Incitec Pivot fell 5.4% to A$2.98 after saying drought in New South Wales and southern Queensland states is crimping demand for fertilizers, while wet weather further north has delayed the start of the sugar-cane season.
Wotif.com declined 4.6% to A$3.11 after Australia's competition regulator raised concerns about Expedia Inc.'s bid for the Australian online accommodation and flight-booking services company.
Australian Bureau of Statistics data showed the balance on goods and services was a deficit of seasonally adjusted A$1,359m in July 2014, a decrease of A$205m (13%) on the deficit in June 2014. The goods and services credits rose A$280m (1%) to A$27,022m, while goods and services debits rose A$74m to A$28,381m.
A separate report from the ABS showed that July retail sales rose 0.4% in July 2014, seasonally adjusted, following a rise of 0.6% in June 2014. The largest contributor to the rise was cafes, restaurants and takeaway food services (1.4%) followed by food retailing (0.5%), department stores (1.9%) and clothing, footwear and personal accessory retailing (0.1%). These were partially offset by falls in other retailing (-0.6%) and household goods retailing (-0.2%).
Shanghai Composite climbs to fresh 15-month high
Mainland China shares advanced for fifth consecutive session, sending the benchmark indices to highest level in more than 15-months, on hopes that Beijing may soon further ease its curbs on financing for property developers. The benchmark Shanghai Composite advanced 18.23 points, or 0.8%, to 2306.86, the highest level since 30th May 2013 when index closed at 2317.75. Turnover decreased to 179.38 billion yuan from Wednesday's 187.55 billion yuan.
Property developers stocks moved up on a media report the government will allow developers to issue mid-term notes in the interbank market to cut funding costs. China Vanke, the biggest developer, rose 1.8% to 9.67 yuan. Poly Real Estate Group Co., the second largest, added 1% 5.91 yuan. Hua Yuan Property added 4.4% to 3.36 yuan.
Bank of America Corp. economist Lu Ting wrote in a research report today that Chinese regulators recently informed some brokers that they will allow listed developers to issue mid-term notes in the interbank market. Allowing developers to issue mid-term notes is equal to credit easing and suggests the government is pushing a fresh round of stimulus to attain its 7.5% growth target, Lu wrote.
Shares of defense companies continued upward move on hopes of asset restructuring amid a pickup in state-owned enterprises reform. Jiangxi Hongdu Aviation Industry rose by its 10% daily upper limit to 24.53 yuan, North Navigation Control Technology gained 8.1% to 24.72 yuan and Aerospace Hi-Tech Holding Group added 4.9% to 28.30 yuan.
Hang Seng falls on profit booking
Hong Kong share market has closed lower, as investors exercised caution ahead of key economic events overseas and cashed in on recent gains. The Hang Seng Index ended 20.03 points, or 0.08%, down at 25297.92. The benchmark index soared to an intra-day high of 25362, a level not seen since May 2008, at one stage in afternoon on the back of the A-share market before losing its gains. Market turnover declined to HK$86.22 billion from HK$100.48 billion on Wednesday.
Shares of Mainland developers trimmed their gains in afternoon session after S&P issued a report noting that tighter credit conditions and structural reform in China could make the operating environment of property developers generally more challenging over the next three years. China Vanke (02202) gained 2% to HK$15.32 after hitting high of HK$15.74. COLI (00688) edged down 0.9% to HK$22.75. CR Land (01109) added 1.5% to HK$18.7. Sunac (01918) soared 7% to HK$6.57.
Yuexiu Property slid 1.2 % to HK$1.65 after saying it will raise HK$3.85 billion ($497 million) in a rights offer to fund future land purchases.
Hengan International dropped 1.6 % to HK$82.60 after BNP Paribas cut its rating on the stock to hold from buy and reduced its share-price forecast to HK$85 from HK$89.50.
Zhuzhou CSR Times Electric Co. surged 7.7 % before suspending trading on a report that the Chinese government is seeking a merger of two locomotive manufacturers, one of which is Zhuzhou's parent. CSR Corp. and China CNR Corp. also halted their shares.
Sensex snaps nine-day winning streak on profit taking
Indian stock market closed the session marginally in the red due to profit-taking by funds and retail investors after eight-day rally amid weak global cues. The 30-share BSE index Sensex ended at 27085.93, down 54.01 points, while the 50-share NSE index Nifty ended at 8095.95, down 18.65 points.
Hindalco Industries and Jindal Steel & Power (JSPL) tumbled on reports that some coal mines of these two companies have not been included by the government in the list of 46 blocks for which the government has requested the Supreme Court for an exemption from possible cancellation. DLF shares declined after local media reported that the Punjab and Haryana High Court on Wednesday cancelled the allotment a 350-acre plot of land the company had acquired from Haryana.
Shares of Jaiprakash Associates slumped on speculation that promoters were reducing their stakes. Jaiprakash clarified in a statement that one of its promoters had reduced stake in the company to 28.30 % from 29.75 %.
Elsewhere in the Asia Pacific region-- Taiwan's Taiex index lost 0.23% to 9428.89. New Zealand's NZX50 rose 0.08% to 5228.55. Indonesia's Jakarta Composite index sank 0.36% to 5205.32. South Korea's KOSPI index rose 0.25% to 2056.26. Singapore's Straits Times index fell 0.07% to 3346.34. Malaysia's KLCI has gained 0.23% to 1869.21.
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