Headline equities of the Asia Pacific market ended mostly softer on Monday, 03 August 2015, as soft lead from US stock markets and slowing Chinese manufacturing activity weighed on the investor sentiments. The MSCI Asia-Pacific Index slipped 0.8% to 140.95.
Risk aversion selloff picked up after downbeat lead from US stocks. On Wall Street, stocks closed lower on Friday following poor earnings from ExxonMobil and Chevron and a fall in oil prices. The Dow Jones Industrial Average slipped 0.31%, while the broad-based S&P 500 dropped 0.22%. The tech-rich Nasdaq Composite Index edged down 0.01%.
Meanwhile, selling momentum compounded after an independent survey showed a key gauge of Chinese manufacturing activity plunged to a two-year low in July, suggesting the world's second-largest economy was struggling. The China's Caixin manufacturing PMI, the index formerly run by HSBC, inked a result of 47.8 in July, well below the 50 point mark which separates expansion from contraction. The result was the lowest point for the read in two years, and a sharp fall from the 49.4 result in June. On Saturday, the government's official manufacturing purchasing managers index slipped to 50.0 in July from 50.2 in June.
Among Asian bourses
Australia stocks end in red
The Australian share market ended lower on first trading day of new month, as weak lead from Wall Street and slowing Chinese manufacturing activity weighed on the market sentiments. Most of the ASX sectors declined, with energy and resources stocks leading declines. The benchmark S&P/ASX 200 Index and the broader All Ordinaries Index both declined by 0.3% to 5679.30 and 5664.30, respectively.
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Shares of energy and mining companies suffered the most losses among ASX industry group, due to poor manufacturing data from China, released over the weekend, and unfavourable movements in commodities markets. BHP Billiton lost 1% to A$26.18, while Rio Tinto gave up 1.3% to A$52.20.
Energy companies suffered losses after the price of US crude slipped 2.9% on Friday and Brent backed off by 2.1%. Oil Search dropped 2.8% to A$7.26. Santos fell 0.8% to A$7.34, while Woodside Petroleum dipped 1.1% to A$35.25. Origin Energy shares ended 1.3% down at A$11.19.
Consumer prices were up 0.2% in July, following a 0.1 rise in June, according to the TD Securities-Melbourne Institute monthly inflation gauge. TD's inflation gauge showed prices were increasing at an annual rate of 1.6%, well below the Reserve bank's target band of 2-3%. TD head of Asia Pacific research Annette Beacher expects inflation to pick up a little pace in the coming months.
Japan stocks closed mixed
Japanese share market ended mixed, as indifferent leads out of Wall Street, stalled Trans-Pacific Partnership (TPP) trade talks and slowing Chinese manufacturing activity weighed on the market. The Nikkei Stock Average declined 37.13 points, or 0.18%, to end at 20548.11 points. The broader Topix index ended 0.08 point higher at 1659.60 points.
Energy explorers and oil refiners declined as crude futures in New York slid as much as 1.6%, after capping a 21% drop in July on Friday, following a claim by Iran that it will be able to bolster production a week after sanctions are lifted. Oil explorer Inpex Corp. lost 2% to 1323 yen, while Japan Drilling Co. slumped 1.6%.
Exporters stocks ended mixed. Toyota Motor Corp fell 0.6% to 8,200 yen, Sony 1.9% to 3,466 yen while Suzuki rose 3.4% to 4,467.5 yen, after US hedge fund Third Point said it had acquired a stake in the small car maker.
Honda Motor Corp escalated 8.8% to 4,328.5 yen after the car maker posted 20% jump in net profit for the quarter ended June 2015, boosted by strong sales in North America and a weak yen.
Toyota Tsusho Corp. dropped 5.8% to 2963 yen after the trading company reported 39% drop in net income on the year to 13 billion yen in the first quarter ended June 2015.
China market extends losses on growth concerns
Mainland China's stock market finished the session sharply lower after slowing domestic manufacturing activity weighed on the investor sentiments. The benchmark Shanghai Composite Index ended 40.82 points, or 1.11%, down at 3622.91 points. The Shenzhen Composite Index, which tracks stocks on China's second exchange, dropped 2.72%, or 57.51 points, to 2053.13 points.
The Shanghai benchmark posted 14% drop in July 2015, posting the biggest monthly loss since August 2009 amid economic growth concerns and a series of supporting measures to rescue a market rout aroused little interest in equities.
Shares of technology and telecom companies declined the most in SSE industry group. Yonyou Network Technology Co. tumbled 8.8%. Hundsun Technologies Inc. slumped 9.3%. ZTE Corp. slid 4.9%.
Shares of financial companies enjoyed strong gains, led by property developers. Gemdale Corp. jumped 4.6%. China Vanke Co. surged 3%.
Hong Kong market ends down
The Hong Kong stock market fell amid sign of deepening China economic slowdown after weak manufacturing data. The Hang Seng Index ended 224.86 points, or 0.91%, higher at 24411.42 points. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, decreased 121.72 points, or 1.09%, to 11009.96 points. Turnover increased to HK$79.5 billion from HK$77.7 billion on Friday.
Chinese financials were lower as A-share market turned softer. Ping An (02318) ended down 2.6% to HK$43.45. China Life (02628) slipped 3.3% to HK$27.6. NCI (01336) sank 3.2% to HK$32.25. Mengniu (02319) plunged 4.3% to HK$33.55 after Goldman Sachs lowered its forecasts for the company and downgraded it to "sell" from "neutral". HSBC Holdings surged 1.9% to HK$71.05 after the lender posted 10.4% rise in profit before tax to US$13,628 million for the first half of 2015.
Casino operators were lower after data from Macau's Gaming Inspection and Coordination Bureau showed Gaming revenue in Macau fell 34.5% year-on-year to MOP18615 million in July. The amount, however, was 7.2% higher than that in June. For the first seven months of 2015, the accumulated gaming revenue amounted to MOP140,259 million, a decrease of 36.7% over the same period last year. Galaxy Ent (00027) declined 2.8% to HK$34.7. Sands China (01928) dropped 1.2% to HK$33.9. MGM China (02882) slid 3.7% to HK$15.86.
Sensex ends edge higher in volatile trade
Indian stock market eked out small gains on first trading day of the week and the month amid a divergent trend among various index constituents. The barometer index, the S&P BSE Sensex, was provisionally up 44.90 points or 0.16% at 28,159.46. The Nifty was provisionally up 10.20 points or 0.12% at 8,543.05. The reason for higher gains for Sensex than Nifty was a post result slide in shares of HCL Technologies which is a Nifty constituent but is not a part of the Sensex.
Index heavyweight and housing finance major HDFC declined. PSU bank stocks edged higher after the finance ministry after trading hours on Friday, 31 July 2015, unveiled a long-term four-year plan for capitalization of PSU banks. Shares of state-run oil marketing (PSU OMCs) fell after cutting petrol, diesel and jet fuel prices.
Meanwhile, the outcome of a monthly survey today, 3 August 2015, showed that manufacturing business conditions across India improved further in July 2015.
Foreign portfolio investors (FPIs) sold Indian shares worth a net Rs 277.77 crore during the previous trading session on Friday, 31 July 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 1021.34 crore on Friday, 31 July 2015, as per provisional data released by the stock exchanges.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index dropped 1.63% to 8524.41. South Korea's KOSPI added lost 1.07% to 2008.49. New Zealand's NZX50 rose 0.62% to 5957.85. Singapore's Straits Times index lost 0.3% at 3192.79. Indonesia's Jakarta Composite index shed 0.05% to 4800.18. Malaysia's KLCI rose 1.2% to 1744.19.
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