Investors turned cautious before the release of the influential US monthly non-farm payroll data later today for more clues about the interest rate outlook in the world's largest economy.
The US government will release the non-farm payroll data for April 2016 later in the global day today, 6 May 2016. The non-farm payroll data could provide more clues about the timing and quantum of future interest rate increases from the US Federal Reserve. The job data has implications for the US monetary policy. The US central bank's mandate centers on maximizing employment and keeping inflation at a 2% target level. The Federal Open Market Committee (FOMC) next undertakes monetary policy review at a two-day meeting on 14-15 June 2016.
Among Asian bourses
Australia Market closes in green
Australian share market ended higher after recouping early losses, with sentiment fuelled by the prospect more rate cuts after the RBA downgraded its inflation forecasts. Most of the ASX sectors advanced with gains were led by bullion, IT, consumer staples, materials, and energy stocks. At close of trade, the benchmark S&P/ASX 200 rose 12.90 points, or 0.24%, to 5292. The broader All Ordinaries grew 14.10 points, or 0.26%, to 5358.60.
RBA has cut inflation forecasts. Underlying inflation is now seen at 1.5% by the end of the current quarter, down from 2% in February, and inflation will stay below 2% for all of next year, indicating that the bank does not expect a near-term rebound in inflationary pressures. The RBA's new forecast that underlying inflation will stay below its 2 to 3% target range until mid-2018 warrants another interest rate cut to 1.5%.
Metal mining stocks were mostly higher, with gold miner Newcrest Mining up 3.8% to A$19.79, while BHP Billiton grew 0.2% to A$18.46 on bargain hunting following heavy losses in past two sessions. Rio Tinto was down 0.7% to A$47.75.
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The banks and financial ended mixed, with Westpac Banking Corp up 1% to A$30.80 and National Australia Bank up 1.3% to A$28.19, while Commonwealth Bank declined 0.7% to A$74.3 and ANZ Banking Group shed 0.8% to A$25.14.
Macquarie shares closed 0.3% down at $65.10. Macquarie bank posted a 29% rise in full year net profit to $2.063 billion, smashing the bank's previous record of $1.8 billion in 2008.
Japan Stocks slip after 3-days holiday
The Japan share market ended lower, extending selloff streak for sixth straight session, after resuming trade after a three-day holiday, as traders played catch-up with losses on global equity markets during a long public holiday. But losses were limited amid a wait-and-see mood ahead of a U.S. jobs report due out later in the day. Total 23 out of 33 TSE industry sectors were down, with Mining, Iron & Steel, Marine Transportation, Securities & Commodities Futures, Nonferrous Metals, and Oil & Coal Products stocks being major losers. The 225-issue Nikkei average declined 40.66 points, or 0.25%, to close at 16106.72. The Topix index of all first-section issues ended down 1.64 points, or 0.13%, at 1298.32.
Sharp Corp. plunged 8.5% after reports the struggling display-maker will post a net loss of 300 billion yen for the year through March. Takata Corp. tumbled 8.6% after the U.S. widened recalls of the company's faulty airbags.
By contrast, domestic demand-oriented names drew brisk purchases. Among them were railway operator JR East, daily goods maker Kao, mobile carrier KDDI and drug manufacturer Takeda. Other major winners included automakers Toyota, Honda and Mitsubishi Motors. Japan Airlines Co. climbed 2% in response to a drop in oil prices during Japan's holidays.
China Market tumbles on bond default woes
Mainland China stock market tumbled, as risk aversion selloff triggered on worries about looming corporate bond defaults and regulatory concerns. All10 SSE sectors declined, with IT, telecom, energy, material, and consumer staple issues being major losers. The benchmark Shanghai Composite Index tumbled 84.59 points, or 2.82%, to 2913.25. The CSI 300 Index, measuring exchanges in Shanghai and Shenzhen, sank 83.77 points, or 2.6%, to 3130.35.
Investors are mostly concerned about contagion risk emanating from a series of bond defaults, after Inner Mongolia Nailun Group Inc., a fertilizer producer, said on Thursday that it defaulted on its bonds because it was unable to meet interest and early redemption payments.
Traders were also focused on rumors that China's securities regulator could suspend the process of Chinese firms that want to de-list their shares in the U.S. and re-list them in either Shanghai or Shenzhen.
All industry groups fell on the CSI 300 index, with Tsingtao Brewery Co. slumping to pace declines in a measure of consumer-staple stocks.
Shares of metal and resources were also lower. Shaanxi Coal lost 6.4 percent, while Wuhan Iron & Steel Co. slid 4.6 percent. PetroChina Co. declined 2%.
FIH Mobile slumped 21 percent, after the company said it expects six-month profit to sink as much as 92 percent.
Hong Kong Market falls 1.66%
The Hong Kong stock market finished lower, reflecting the fifth consecutive day of losses, on tracking steep losses in Mainland A-share market which tumbled on concerns about looming bond defaults. The benchmark Hang Seng Index dropped 339.95 points, or 1.66%, to 20109.87 points. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, lost 155.03 points, or 1.8%, to 8471.70 points. Turnover increased to HK$67.7 billion from HK$56.6 billion on Thursday.
Wynn Macau (01128) dipped 3% to HK$10.62 even though its 1Q earnings decreased 27%. Investors were also worried about the phone betting ban imposed by Macau government. Galaxy Ent (00027) was the worst blue-chip loser. It ended down 4% to HK$24.45. Sands China (01928) fell 2% to HK$26.95.
ZTE (00763) dived 11% to HK$10.44, and Lenovo (00992) dropped 2% to HK$5.64. News reports say that ZTE, Lenovo and Samsung will be investigated by the US authorities over alleged patent infringement.
Only four blue chips rose today. Tencent (00700) added 0.5% to HK$153.9 on hopes of better quarterly results following Alibaba's strong earnings. CLP (00002) reports its earnings next Monday. It closed up 0.1% to HK$72.25.
Sensex registers tiny losses
Amid a divergent trend for various index constituents, the Nifty 50 index ended near the flat line. The barometer index, the S&P BSE Sensex, registered small losses. The Sensex lost 33.71 points or 0.13% to settle at 25,228.50. The Nifty fell 2.05 points or 0.03% to settle at 7,733.45.
Stocks of public sector banks edged higher after the Lok Sabha passed the Insolvency and Bankruptcy Code, 2016 yesterday, 5 May 2016. Shares of public sector oil marketing companies (PSU OMCs) edged higher on decline in crude oil prices. Index heavyweight and cigarette major ITC trimmed losses triggered by the company's announcement of temporary closure of manufacturing of cigarettes at all its cigarette manufacturing units. Bharti Airtel rose after its subsidiary Bharti Airtel International (Netherlands) BV announced an agreement for the divestment of approximately 950 telecom towers in the Democratic Republic of Congo (DRC) to and Helios Towers Africa (HTA).
Eicher Motors rose in the wake of the company's announcement of strong financial performance for the quarter ended 31 March 2016 and management commentary of positive outlook for the motorcycle business. Hero MotoCorp dropped in volatile trade as its fourth quarter results came in line with market expectations. Bharat Heavy Electricals (Bhel) rose after the company announced that it has added another coal-based power plant to the grid by successfully commissioning a 500 megawatts (MW) thermal unit in Jharkhand.
Elsewhere in the Asia Pacific region: New Zealand's NZX50 was up 0.3% to 6876.48. South Korea's KOSPI index fell 0.5% to 1976.71. Taiwan's Taiex index slid 0.3% to 8146.43. Malaysia's KLCI grew 0.3% to 1649.36. Indonesia's Jakarta Composite index added 0.2% to 4822.60. Singapore's Straits Times index shed 1.3% to 273.80.
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