Asia Pacific share market closed mostly higher on Tuesday, 09 August 2016, as encouraging economic data in China and Europe combining with steady oil kept investor mood positive. Traders also reacted to news that Germany's trade surplus beat expectations to shrink only slightly in June after exports returned to growth. But gains were limited as investors elected to book profit after strong recent gains.
Data released on Tuesday showed that China's consumer price inflation accelerated at its weakest pace in six months, while the long decline in upstream prices continued to moderate. China's statistics bureau reported the country's July CPI inflation eased to 1.8% compared with the same period a year ago, compared to 1.9% in June. The producer price index (PPI) deflation continued to moderate, falling 1.7% in July from a year earlier. Market pundit expects low inflation means there's still room for monetary easing, although Beijing will be cautious in using such tools, which have side effects, as well as limits in stimulating the economy.
Elsewhere, the Indian central bank kept its repo-rate unchanged at 6.50% and its cash reserve ratio unchanged at 4%. In its policy statement, the Reserve Bank of India (RBI) said monetary policy remains "accommodative" and will "continue to emphasize the adequate provision of liquidity."
Brent crude, the international energy benchmark, was flat at $45.38 a barrel after swinging between $44.80 and $45.77. US West Texas Intermediate was down 0.2% at $42.95. Both measures rose sharply on Monday after news that Opec had called an informal meeting next month raised the possibility of an output freeze.
Among Asian bourses
ASX200 ends 0.27% up
Australian share market finished the session higher, with financials sector leading the way, followed by energy sector, as crude oil prices closed at a two week high overnight. At close of trade, the benchmark S&P/ASX 200 index rose 14.70 points, or 0.27%, to 5552.50. The broader All Ordinaries inclined 11 points, or 0.2%, to 5636.70. Falling stocks outnumbered advancing ones on the Australia Stock Exchange by 615 to 464 and 331 ended unchanged. The S&P/ASX 200 VIX, which measures the implied volatility of S&P/ASX 200 options, was down 8.12% to 12.720 a new 52-week low.
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The banks and financial stocks advanced on the back of better than expected ANZ's third quarter update. ANZ reported its earnings in the first nine months of the year had slipped 3% to $5.2 billion on a lift in bad debt charges, but investors took the news as better than the worst-case scenario, sending bank stocks higher. ANZ Banking Group inclined 2.9% to A$26.44, Commonwealth Bank of Australia 1.6% to A$78.41, Westpac Banking Corp 1.8% to A$30.99, and National Australia Bank 2.2% to A$26.84.
Energy stocks were up, buoyed by jump in crude oil prices to two week high overnight trade after the president of OPEC said informal talks would be held in September, while Qatar's energy minister was quoted as saying OPEC members were in constant talks to stabilise the market. Woodside Petroleum advanced 1.1% to A$27.70, Oil Search 1.4% to A$7.49, and Santos 1.7% to A$4.76.
IOOF shares lost 7.6% to close at A$8.60 after the funds and wealth manager reported flat full year revenue of $907.8 million. Underlying net profit after tax at A$173.4 million was in line with May guidance.
Cochlear lost 2.8% to A$125 despite the bionic ear company increasing full year profit by 30% to A$188.9 million and giving guidance of a 10% to 20% rise this year.
Japan Market extends gain
The Japan share market advanced for second straight session, as gains in the Mining, Paper & Pulp and Food sectors led shares higher. The 225-issue Nikkei stock average rose 114.40 points, or 0.69%, to finish at 16,764.97. The Topix index of all first-section issues ended up 11.96 points, or 0.92%, at 1,317.49. Advancing stocks outnumbered falling ones by 1297 to 615 and 144 ended unchanged on the Tokyo Stock Exchange. The Nikkei Volatility, which measures the implied volatility of Nikkei 225 options, was down 1.66% to 19.56 a new 6-month low.
Telecommunication companies provided the biggest boost to the Topix, with SoftBank Group Corp. rising 3.4%. Nippon Telegraph & Telephone Corp. added 1.7%.
Automakers were a drag on the Topix. Toyota Motor Corp. slipped 0.7% and Honda Motor Co. lost 0.3%.
Obayashi Corp. slumped 4.9% to its lowest level since Jan. 21 The construction company's spokesman said its U.S. unit is involved in the reportedly sinking Millennium Tower in San Francisco.
China Stocks up on economic data support
Mainland China stock market closed higher for a sixth straight session, as July consumer inflation data keeping alive hopes of further monetary policy easing, while improving producer prices attracted bets on resources shares. The CSI300 index of the largest listed companies in Shanghai and Shenzhen gained 0.7%, to 3256.98, while the Shanghai Composite Index inclined 0.71%, to 3025.68 points and the Shenzhen Composite index closed 1.04% higher at 1982.66 points.
Consumer-staples and industrial companies paced advances in mainland trading, with their sub-indexes rising at least 1.1%. Liquor maker Kweichow Moutai Co. added 2.5%, while China State Construction Engineering Corp. gained 3.9%.
Dongxu Optoelectronic Technology Co. led gains by manufacturers after China's factory-gate deflation eased in July for a seventh month in a row.
China Film Co., the nation's largest movie distributor, jumped 44% first-day limit in its Shanghai debut.
Hong Kong Stocks fall on profit taking
The Hong Kong stock market ended down in narrow trade, as investors elected to book profit after the three major benchmarks in the US closed softer overnight. The benchmark Hang Seng Index declined 29.15 points, or 0.13%, to 22465.61 points. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, rose 24.61 points, or 0.27%, to 9301.17. Turnover decreased to HK$53.2 billion from HK$60.8 billion on Monday.
HK Index heavyweight China Mobile led the losses among the top five active shares, down 1.23% to HK$96.5 ahead of the release its half-year results on Thursday. Smaller rivals China Telecom and China Unicom also pulled back, down 0.25% and 0.24% respectively.
Shares of coal industry were among the biggest gainers in Hong Kong, as improving producer prices in China attract bets on resources shares. SouthGobi Resources jumped 2.9% to HK$ 1.42 and Asia Coal added 2.67% to HK$0.19.
Shares of retailers gained after data showing China's food prices rose 3.3% in July. Want Want (00151) jumped 3% to HK$4.97. Tingyi (00322) put on 1% to HK$7.23. U-presid China (00220) soared 4% to HK$6.71.
MTRC (00066) softened 1% to HK$43.5 ahead of its earnings report later today. BofA Merrill Lynch expected its 1H underlying earnings decline of 35%.
CR Land (01109) surged 3% to HK$21.4 after BofAML rated it "buy" and forecast its interim underlying net growth of 16%. COLI (00688) gained 1% to HK$26.9.
Indian Market snaps three-day winning streak
Indian benchmark indices registered small losses after the Reserve Bank of India (RBI) kept its benchmark lending rate viz. the repo rate unchanged after a policy review. The barometer index, the S&P BSE Sensex, fell 97.41 points or 0.35% to settle at 28,085.16. The Nifty 50 index dropped 33.10 points or 0.38% to settle at 8,678.25.
The Reserve Bank of India (RBI) kept its benchmark lending rate viz. the repo rate unchanged at 6.5% after a monetary policy review today, 9 August 2016. The RBI also kept the cash reserve ratio (CRR) of scheduled banks unchanged at 4% of net demand and time liabilities (NDTL). The central bank said it will continue to provide liquidity as required and will progressively lower the average ex ante liquidity deficit in the system from 1% of NDTL to a position closer to neutrality. The RBI said that the recent sharper-than-anticipated increase in food prices has pushed up the projected trajectory of inflation over the rest of the year. The central bank also said that the strong improvement in sowing on the back of the monsoon's steady progress, along with supply management measures, augers well for the food inflation outlook. According to the central bank, risks to the inflation target of 5% for March 2017 continue to be on the upside. The RBI has retained the projected GVA growth projection for 2016-17 at 7.6%.
Adani Ports and Special Economic Zone (APSEZ) edged lower after announcing Q1 June 2016 results. The stock shed 0.79%. The company's consolidated net profit rose 31% to Rs 836 crore on 11% growth in total income to Rs 2084 crore in Q1 June 2016 over Q1 June 2015. The result was announced during market hours today, 9 August 2016.
APSEZ's consolidated cargo volumes increased by 7% to 42.33 million metric tonne (MMT) in Q1 June 2016 over Q1 June 2015.
Elsewhere in the Asia Pacific region: New Zealand's NZX50 added 0.2% to 7363.16. South Korea's KOSPI index climbed 0.62% to 2043.78. Taiwan's Taiex index grew 0.05% to 9155.08. Malaysia's KLCI was down 0.1% to 1671.71. Indonesia's Jakarta Composite index fell 0.34% to 5441.29. Singapore's Straits Times index closed for market holiday.
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