Wall Street shares pulled away from recent record highs and fell overnight as demand for risky assets waned ahead of Thursday's events. Comey, who will testify on Thursday, was investigating whether Donald Trump's presidential campaign and Russia colluded to sway the 2016 US election when he was fired by Trump in May. Investors are worried his testimony could dampen already flagging momentum for Trump's agenda of rolling back regulations and overhauling the tax code.
A wait-and-see mood also prevailed ahead of the European Central Bank's policy meeting on Thursday, another of this week's major events that the markets are bracing for. While the ECB is not expected to shift rates or make changes to its quantitative easing scheme this week, market participants will sift through President Mario Draghi's statements for his view on the euro zone economy.
Among Asian bourses
Australia Stocks end flat
Australian equity market ended virtually flat after recouping intraday losses, as investors pleased with better than expected economic growth data. Data from the statistics agency showed Australia's gross domestic product expanded 0.3% in the three months through March from the previous quarter and rose 1.7% on year. The S&P/ASX 200 finished 0.3 points lower at 5667.20 after falling by as much as 0.4% in early trading.
Shares of material companies boosted up by strength in gold stocks as the yellow metal surged to seven month highs. Newcrest Mining was up 0.8%, while Evolution Mining rose one%. Rio Tinto was up 1% as the miner on Wednesday detailed pricing for a US$781 million cash tender as part of its already announced US$2.5 billion bond buyback to reduce its debt. A rise in copper on the London Metals Exchange also lent support. BHP, which has significant oil interests, was 0.6% lower as oil and iron ore eased.
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Shares of energy sector were driven higher by a gain of up to 5.8% by coal miner Whitehaven Coal. Other energy stocks eked out modest gains as well ahead of inventory data from the US later in the week. Woodside Petroleum, however, was 0.2% lower.
Shares of consumer sector felt selloff pressure due to concerns about falling household spending as a property boom appears to be cooling off. Wesfarmers fell 3.4%, its lowest in nearly seven months, while rival Woolworths was down 0.4%.
Nikkei virtually flat
The Japan share market finished session virtually flat, as some investors chased for bargain on intraday dip. Also, expectations for exchange-traded fund purchases by the Bank of Japan also supported the market. But the market's topside was capped amid a growing wait-and-see mood ahead of key events that include Britain's general election, the European Central Bank's policy meeting, and testimony in the U.S. Congress by former Federal Bureau of Investigation Director James Comey over Russia-linked allegations surrounding U.S. President Donald Trump. Uncertainties over the results of the events brought about some risk-averse sentiment in the market. Mining, nonferrous metal and securities house-related stocks comprised those that gained the most by the close of play. At the close, the 225-issue Nikkei average gained 4.72 points, or 0.02%, to close at 19,984.62. The Topix index of all first-section issues closed up 0.65 point, or 0.04%, at 1,597.09, after falling 13.53 points the previous day.
Shares of Mega-bank groups Mitsubishi UFJ, Sumitomo Mitsui and Mizuho, insurer Tokio Marine and brokerage firm Nomura were buoyant. Oil companies Japex, Inpex and JXTG Holdings also attracted buying. Other major winners included mobile phone carrier SoftBank Group, semiconductor-related Tokyo Electron, electronics maker Panasonic and daily goods producer Kao.
By contrast, automakers Toyota and Honda, camera producer Canon and industrial robot manufacturer Fanuc met with selling. Drug makers Takeda and Astellas, clothing store chain operator Fast Retailing and retail giant Seven & I Holdings were also on the minus side.
China Stocks up as firms urge workers to buy shares, MSCI inclusion hopes
The Mainland China equity market closed up, as a growing number of listed firms encouraged employees to buy shares, and as the central bank moved to ease fears of a mid-year liquidity crunch. Hopes that MSCI will include China's A shares in its indexes later this month also whetted investors' appetite for big-cap stocks. At the close, the benchmark Shanghai Composite Index closed 1.23%, or 38.19 points, higher at 3,140.32. The Shenzhen Composite Index, which tracks stocks on China's second exchange, advanced 2.19%, or 39.73 points, to 1,850.53. The ChiNext gauge of smaller companies advanced 1.9% to 1,799.85 in Shenzhen, the biggest gain in three weeks.
Since Tuesday, 10 companies, including Qingdao Kingking Applied Chemistry , issued statements to the effect that the company's controlling shareholders were encouraging employees to buy shares and would compensate them should losses occur. Shares in those companies have jumped in response, and the optimism appears to be spreading as investors bet more companies would issue similar statements.
Small-capitalisation companies led gains after the China Securities Regulatory Commission slowed down the pace at which it was approving initial public offerings, which are dominated by smaller firms. The number of IPO companies was cut to four last week from seven, a second straight week of reductions. Hangzhou Landscape Architecture Design Institute surged by the 10% daily cap to 61.45 yuan and Shenzhen Minde Electronics Technology gained 6.3% to 54.83 yuan.
A gauge of consumer stocks rose 2.1% on Wednesday, the best-performing industry group after small-cap technology companies Kweichow Moutai, the nation's biggest liquor maker, added 2.4% to 459.37 yuan, a record close. Wuliangye Yibin, a smaller rival, also closed at a record 50.90 yuan after a 4.9% gain.
Hong Kong Stocks end lower
The Hong Kong stock market finished session down, as risk sentiments weighed down ahead of key events that include Britain's general election, a European Central Bank policy meeting and congressional testimony by fired FBI boss James Comey on Donald Trump's Russia ties. The Hang Seng Index ended down 22 points or 0.1% to 25,974. Turnover increased to HK$87 billion from HK$74.6 billion on Tuesday.
AAC Tech (02018) soared 14% to HK$92.55 on resumption of trading after dismissing an allegation by a US-based short-seller of dubious accounting practices and overstating profits. The company issued a clarification announcement and denied all the allegations made against the company in the Gotham City Research's report. The company provided an independent report that rates it as a strong buy with a target price of HK$111 at a Tuesday press conference.
Macau gaming counters were higher. Galaxy Entertainment (00027) and Sands China (01928) rose 4% and 2% to HK$45.95 and HK$35.05. Melco International Development (00200) added 2% to HK$19.9.
Link REIT (00823) declared a final distribution of HK116.7 cents, up 8.8%. The stock was flat at HK$61.65.
Tongda Group (00698) rebounded 9% to HK$2.2 after the company fell off the radar of the short-sellers. Meanwhile, FG Alpha Management also said it was short Dali Foods (03799), which ended down 7% to HK$4.3.
Man Wah Holdings tumbled 10% to HK$6.03 before trading was suspended, as the sofa maker became the latest short-selling target of Muddy Waters Research. The company has 48% more debt than it had disclosed, Muddy Waters' founder Carson Block said during an investment conference in Hong Kong.
New World Department Store China surged 43% to HK$1.90 on plans to take the company private as the stock resumed trading after being suspended over the past two days.
Indian market logs modest gains as RBI maintains status quo on repo rate
Key benchmark indices settled with modest gains in a volatile session of trade after the Reserve Bank of India (RBI) decided to keep the policy repo rate unchanged after a policy review meet today. The barometer index, the S&P BSE Sensex rose 80.72 points or 0.26% to settle at 31,271.28. The Nifty 50 index gained 26.75 points or 0.28% to settle at 9,663.90. Gains on the domestic bourses supported by good prospects of rains and firm global stocks.
A sharp drop was witnessed in IT stocks amid a media report saying that the Infosys' clients were asking for 20-30% cut in prices for projects. Bank stocks rose after RBI kept policy repo rate steady. Pharma stocks rose on bargain hunting after the recent losses.
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