Jobs data released Friday presented a mixed picture of the state of the U.S. labor market. U.S. nonfarm payrolls increased 173,000 last month compared with economists' forecasts of a 220,000 gain, but the jobless rate fell to 5.1%, its lowest since 2008. The jobs report was the last major data point before the Fed meets on Sept. 16-17 to discuss the timing of its first increase in interest rates in nearly a decade. Money managers around the world are closely watching when the Federal Reserve will start reversing its easy monetary policy, which has helped create large investment flows into emerging economies. Higher interest rates in the U.S. are likely to give the dollar a boost, as they make the currency more attractive to yield-seeking investors.
China cut its growth rate for last year to 7.3% from 7.4%. Though tiny, the difference suggests that China's struggle last year to meet its official growth target was more difficult than previously realized. China's growth target last year was about 7.5%. The revision of China's growth rate last year reinforced the biggest fear for global investors about China's slowdown is worse than thought.
Among Asian bourses
Resources weigh on Australia market
The Australian share market closed softer on first trading session of the week, following Friday's Wall Street slide, triggered after the August U.S. jobs report failed to give a clear view on the Federal Reserve's interest rate hike. Also, risk aversion selloff pressurized on underlining concerns about the health of the world's second largest economy after China revised its annual economic growth rate in 2014 to 7.3% from the previously released figure of 7.4%. Most of the blue chips declined, with energy, materials & resources, and consumer goods heavyweights being major losers. The benchmark S&P/ASX 200 index declined 10.20 points, or 0.2%, to 5030.40 points. The broader All Ordinaries index closed 9.80 points, or 0.19%, up at 5051.
Resource stocks weighed heaviest on the index, with the materials sector falling 0.7% and energy losing 1.3%. Among the big miners, BHP dropped 1.9% to A$24.21 and Rio Tinto lost 1% to A$49.28, but Fortescue bucked the trend gaining 3.2% to A$1.92. Oil and gas heavyweight Woodside Petroleum fell 0.4% to A$30.48, Origin Energy retreated 3.1% to A$7.44, Santos tanked 4.8% to A$4.17, and Oil Search lost 0.9% to A$6.70.
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Financial stocks were down, with top four lenders being major losers. National Australia Bank led losses among major banks, down 0.8% to A$29.55, meanwhile Australia & New Zealand Banking Group dropped 0.7% to A$26.66 and Commonwealth Bank declined 0.1% to A$72.11. Westpac Bank fell 0.5% to A$29.80 after the bank announced it would lift its annual investment spend by 20% -- to around A$1.3 billion -- as it detailed plans to add more than 1 million new customers over the coming two years.
Industrials firm UGL improved 1.1% to A$1.845 after it was revealed as the preferred contractor for a portion of Sydney's A$3 billion NorthConnex tunnel-motorway project, while utility AGL fell 0.1% to A$16.02 after it confirmed the pending sale of its 50% share in Australia's biggest wind farm, Macarthur.
ANZ's job advertisement figures showed a 1% increase in job ads during August while the Ai Group-HIA construction index rose sharply by 6.7 points to 53.8 points, entering expansionary territory for first time since March.
Nikkei ends 0.4% up
The Japanese share market finished the session edge above the neutral line after swinging between gains and losses, as market participants picked up heavily battered stocks after heavy selloff last week. But market gain was marginal amidst concerns about a hard landing for the Chinese economy and uncertainty over timing of the Federal Reserve rate hike after mixed August jobs data. The Nikkei Stock Average advanced 68.31 points, or 0.38%, to end at 17860.47 points. The broader Topix index rose 0.08%, or 1.12 points, to 1445.65 at the close in Tokyo.
Total 18 out of 33 TSE sectors ended higher, led by Warehousing & Harbor Transportation Services, Transportation Equipment; Fishery, Agriculture & Forestry; Electric Power & Gas; and Air Transportation issues. Bucking the trend, Glass & Ceramics Products; Real Estate; Foods; and Other Financial Business sectors being major drag of the day.
Toshiba Corp gained 1.8% after the company moved to close the books on an accounting scandal that had repeatedly delayed its results. It said it had overstated its profit by 224.8 billion ($1.89 billion) over seven years, more than four times the initial estimate when irregularities came to light earlier this year. Soon after the market opened Monday, the company reported an annual loss of 37.8 billion yen ($318 million) for the fiscal year ended March 2015 compared to a profit of 60.2 billion a year earlier.
Builder Haseko Corp gained 1.6% and social media site operator DeNA Co surged 8.7 after the index compiler Nikkei Inc. said it would add the companies to the Nikkei 225 Stock Average at the end of the month, replacing Nitto Boseki Co. and Heiwa Real Estate Co. Nitto Boseki plunged 19% and Heiwa slumped 14%.
Shanghai Composite tumbles 2.52%
Mainland China's stock market closed steep lower in volatile trade on deepening gloom over the domestic economic growth after statistics authority lowered the country's growth rate to 7.3% for 2014 based on its preliminary verification. Selloff fueled further on speculation state-backed funds had stopped buying. The Shanghai Composite Index fell 2.52%, or 79.75 points, to 3080.42 points. The Shenzhen Composite Index, which tracks stocks on China's second exchange, ended up 0.2%, or 3.38 points, to 1677.33. The ChiNext Index, which tracks China's NASDAQ-style board of growth enterprises, gained 2.07%, or 38.49 points, to close at 1893.52.
Chinese markets saw rocky trade today after a two-day holiday at the end of last week, with the benchmark Shanghai Composite Index at first opening slightly in the red before lifting to be nearly 1.8% to the positive after weekend comments from authorities that the stock market rout is close to ending. But the index tracked down from there to end the day 2.5% weaker. Investors took the intraday gains as an opportunity to take profit after the market had been closed last Thursday and Friday for a national holiday.
With concerns about China's outlook helping trigger the biggest monthly sell-off in global stocks in more than three years in August, a gathering of Group of 20 finance chiefs in Turkey on Friday and Saturday focused on China's efforts to shore up its economy. People's Bank of China Governor Zhou Xiaochuan said in a statement that the rout in Chinese equities is close to ending, and that state intervention prevented systemic risk and stopped a free-fall.
Shares of financial stocks declined the most in Shanghai after Moody's Investors Service said in a statement on Monday that China's banks are failing to include some debts that have been overdue for at least 90 days. The ratings company cited its analysis of the first-half results of 11 listed banks. ICBC, the nation's most valuable bank, slid 8.7%, after jumping 18% in the previous two trading sessions. China Minsheng Banking Corp. retreated 9.3%.
China's foreign-exchange reserves fell by a record last month as the central bank sold dollars to support the yuan after the biggest devaluation in two decades spurred bets on continued weakness. The currency hoard declined by $93.9 billion to $3.56 trillion at the end of August, from $3.65 trillion a month earlier.
Hong Kong market ends softer
Hong Kong stock market ended down in volatile trade amid lingering uncertainty over the timing of a widely expected interest rate increase by the U.S. Federal Reserve. Meanwhile, lingering concerns over the health of China's economy also rattled stocks. The Hang Seng Index (HSI) opened down 157 points but closed firmer by midday. It reversed the uptrend in afternoon session, and saw its losses widen towards market close. The Hang Seng Index ended down by 257.09 points, or 1.23%, at 20583.52 points. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, sank 66.37 points, or 0.72%, to 9103.22 points. Turnover reduced slightly to HK$67.2 billion from HK$69.3 billion on Friday.
Shares of retailers declined the most in Hong Kong market, with Belle (01880) leading losses, down 5.3% to HK$6.84, after legislator representing the wholesale and retail constituency called for adding more cities to the Individual Visit Scheme (IVS) to boost the retail industry. He added that the current situation is far worse than that in SARS period. Sa Sa (00178) dropped 4.4% to HK$3.01. Bonjour (00653) slipped 1.5% to HK$0.325.
Broker counters bucked the downtrend, with GF Sec (01776) jumping 4.5% to HK$13.58, meanwhile CGS (06881) soared 4% to HK$4.94.
HKEx (00388) edged down 0.5% to HK$175.1 as its Chief Executive Charles Li said the progress of Connect programs may slow down because of the slide of China market.
Kunlun Energy (00135) gained 2.3% to HK$5.29 despite weaker oil prices. Crude oil extended losses from Friday, when they fell on lingering supply glut woes and Wall Street losses. U.S. crude oil futures were down 0.8% at A$45.67 a barrel.
Sensex dives in red
A bout of volatility was witnessed as key benchmark indices weakened once again after trimming losses in mid-afternoon trade. At 14:17 IST, the Sensex was off 117.29 points or 0.47% at 25,084.61. The broad market depicted weakness. On BSE, there were over two losers against every gainer. 1,708 shares declined and 785 shares rose. A total of 98 shares were unchanged. The BSE Mid-Cap index was down 1.56%. The BSE Small-Cap index was down 0.92%. The decline in both these indices was higher than Sensex's fall in percentage terms.
Mahindra & Mahindra (M&M) declined 0.06%. M&M after market hours on Friday, 4 September 2015, announced that Telephonics Corporation (USA) is in the process of raising its stake in Mahindra Telephonics Integrated Systems (MTIS) to 49% from 26%. Telephonics Corporation has already received approval from the Foreign Investment Promotion Board for increasing its stake to 49% from 26% in MTIS. Currently, the Mahindra group holds 74% stake and Telephonics Corporation holds 26% stake in MTIS. MTIS has a state of the art production facility near Faridabad in Haryana where it currently manufactures airborne weather radars systems.
Yes Bank rose 1.29% on reports that a foreign brokerage has reiterated its 'buy' rating on the stock. The foreign brokerage has reportedly stated in a research report that the Yes Bank stock has already factored in concerns about the asset quality of the bank.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index fell 0.2% to 7986.56. South Korea's KOPSI dropped 0.2% to 1883.22. New Zealand's NZX50 rose 0.5% to 5572.73. Singapore's Straits Times index slipped 0.4% at 2852.41. Indonesia's Jakarta Composite index dropped 2.6% to 4301.37. Malaysia's KLCI sank 0.4% to 1582.85.
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