Asia Pacific share market ended mostly down on Tuesday, 29 March 2016, as oil prices skidded, and investors awaited Federal Reserve Chair Janet Yellen's speech for clues on when the central bank may raise interest rates.
Yellen, who is due to speak before the Economic Club of New York later in the global day, will make her first remarks since the Fed's meeting in March. The central bank has said it will depend on economic data before it makes a decision on rates, but several policymakers have voiced support for more than one increase this year. Investors will keep a close eye on Yellen's speech as they look for fresh drivers that could push stocks higher.
Oil prices fell on Tuesday, reflecting growing concerns that a two-month rally may be fading, as supply looked set to keep rising and there appeared to be little immediate prospect of demand keeping pace. The oil price has risen more than 45 percent since mid-February ahead of a meeting next month of the world's major producers to discuss an output freeze. But there is growing scepticism about the outcome of the meeting.
Brent crude futures fell by $1.20 to $39.07 a barrel by 1350 GMT, having lost 7 percent in the last week, while U.S. crude dropped by $1.32 to $38.07.
OPEC and other major suppliers, including Russia, are to meet on April 17 in Doha to discuss an output freeze aimed at bolstering prices. The oil price touched session lows earlier after a source familiar with Iranian thinking said Iran would attend the meeting, but this did not mean it would take part in negotiations over production freezes. Kuwait said on Tuesday it had agreed with Saudi Arabia to resume production at the jointly operated Khafji field, which shut in October 2014 for environmental reasons, having been producing between 280,000 and 300,000 barrels per day.
Among Asian bourses
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Australia Market closes 1.1% down
Australian share market finished session deeply in red, due to risk aversion selloff across the board, with financials and commodity-linked stocks being major losers. At close of trade the benchmark S&P/ASX 200 tumbled 1.57%, or 79.70 points, to 5004.50. The broader All Ordinaries fell 1.46%, or 75.40 points, to 5076.20.
Banks and financials continued last Thursday's aggressive selloff, as investors remained worried about bad debts linked to the mining sector slump after ANZ and Westpac warned about exposure to the down-turned resources industry on Thursday. ANZ has warned that its bad debts will jump by at least $100 million for the first half of the financial year, while Westpac increased debt provisions for bad consumer loans in the resource-heavy states of Western Australia and Queensland. ANZ Banking Group fell 3.4% to A$23.20 and Westpac Banking Corp fell 3% to A$29.93. National Australia Bank lost 2.4% to A$25.62. Commonwealth Bank of Australia dropped 2.3% to A$73.12.
Shares of commodity linked players were also struggled, inline with drop in iron ore and crude oil prices. Among the major miners, global miner BHP Billiton ended down 29 cents to A$16.71, Rio Tinto was 16 cents off at A$42.14, and Fortescue Metals was off 3 cents at A$2.54. Oil and gas producer Santos was flat at A$4.03, while Woodside Petroleum was 30 cents lower at A$26.64.
Nikkei ends 0.2% down
Japan share market finished slight lower, following a raft of official data that dented investor sentiment. The market weakness was also due to stock holdings reduction from investors before the end of the fiscal year and caution ahead of U.S. Federal Reserve Janet Yellen's speech later in the day. The 225-issue Nikkei Stock Average ended down 30.84 points, or 0.18%, at 17103.53. The broader Topix index of all First Section issues on the Tokyo Stock Exchange finished 4.25 points, or 0.31%, lower at 1,377.60.
Japan's jobless rate rose slightly to 3.3% in February, up from 3.2% in January, despite labour demand remaining at the highest level in two decades, as against expectation of remain unchanged at 3.2%. Other official numbers released from Japan on Tuesday showed that household spending rose 1.2% in February compared with the same month last year, against expectations for a decline of 1.5%. Retail sales rose 0.5% in February from a year earlier, lower than expectations for an increase of 1.7%.
Tokyo stocks opened little changed as offshore market overnight provided a muted lead. US stocks moved modestly either side of unchanged as traders awaited data this week, while European markets were closed for the Good Friday and Easter Monday holidays. Key economic data due for release includes China's manufacturing PMI and US employment data on Friday. Although selling to lock in gains took the upper hand, the market gradually trimmed losses in the morning session on the back of the yen's weakening against the dollar, briefly pushing up the Nikkei average to positive territory. In the afternoon, however, stocks lost their upward momentum, with the key market gauge falling back in thin trading, as investors retreated to the sidelines before key U.S. economic indicators are released and Yellen delivers a speech in New York, later on Tuesday
Drugmakers Astellas and Takeda, airlines JAL and ANA, and railway operator JR East met with selling. Also on the minus side were megabanks Mitsubishi UFJ, Sumitomo Mitsui and Mizuho, condominium builder Daito Trust Construction and oil company Inpex. Other major losers included automakers Toyota and Fuji Heavy, game maker Nintendo and industrial robot producer Fanuc.
By contrast, clothing store chain operator Fast Retailing, retailer Seven & i Holdings and mobile phone carrier SoftBank Group attracted buying. Automaker Mazda, electronics producer Sony and Japan Tobacco were also buoyant.
China Market extends losses
Mainland China stock market closed down for second straight session, as investors continued withdrawing profit off the table after strong recent rally and on caution ahead of key economic figures later this week. The benchmark Shanghai Composite Index surrendered 37.99 points, or 1.28%, to 2919.83. The CSI 300 Index, measuring exchanges in Shanghai and Shenzhen, dropped 34.32 points, or 1.08%, to 3135.41.
Mainland Chinese shares moved up more than 10% since hitting a January low, on hopes for fresh measures from Beijing to kickstart the economy, which is growing at rates not seen for a quarter of a century. Traders are now awaiting the release of closely watched manufacturing data at the end of the week, hoping for fresh signs of improvement in the Asian economic giant.
Shares of commodity-linked companies declined, led by steelmakers, as a drop in Shanghai steel prices fuelled losses in other raw materials such as iron ore.
Banking stocks were soft, as China's Big Four state-run banks this week are set to report annual earnings growth that likely flat-lined, as a surge in soured loans continued unabated while economic expansion weakened.
Property developers extended losses amid concern new price-cooling measures will hit sales. Poly Real Estate slid 2.6%, while Gemdale Corp. declined 2.2%.
Airlines led declines for industrial companies after an Egypt Air flight from Alexandria to Cairo was hijacked. Air China Ltd. slumped 3.1%.
Hong Kong Stocks end up
The Hong Kong stock market closed slight higher, after the market resumed trading following the long Easter weekend. The benchmark Hang Seng Index rose 20.69 points, or 0.1%, to 20366.30 points. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, grew 25.80 points, or 0.3%, to 8726.93 points. Turnover reduced to HK$60.1 billion from HK$62.6 billion on Thursday. The local market closed on Friday to Monday for Easter holidays.
Wynn Macau (01128) soared 7% to HK$11.6 ahead of its earnings report tomorrow. Other gaming counters also rose across the board. Sands China (01928) jumped 4% to HK$31.2. It was the best blue-chip winner today. Galaxy Ent (00027) put on 2% to HK$29.1.
CNOOC (00883) edged up 0.3% to HK$8.99. PetroChina (00857) slipped 3% to HK$4.99. It was the top blue-chip loser today. Sinopec (00386) softened 1% to HK$4.72.
Chinese developers were pressured as government launched a slew of policies to contain the property markets, with Beijing, Shanghai, Guangzhou and Shenzhen as the target cities. COLI (00688) and CR Land (01109) declined 1% and 3% to HK$23.95 and HK$19.48.
Chinese insurer sector kicked off its earnings season. PICC P&C (02328) jumped 5% to HK$13.76 as its earnings rose 45% to RMB21.85 billion. Its parent company PICC Group (01339) also reported earnings growth of 49%. It gained 1% to HK$3.14.
Sensex, Nifty hit lowest closing level in almost 2 weeks
Losses for stocks of pharma and IT companies and index heavyweight HDFC outweighed gains for stocks of telecom firms, private sector banks and index heavyweight Reliance Industries (RIL), with the two key benchmark indices registering small losses. The barometer index, the S&P BSE Sensex, fell 65.94 points or 0.26% to settle at 24,900.46. The 50-unit Nifty 50 index fell 18.10 points or 0.24% to settle at 7,597.
Drug maker Lupin edged lower in volatile trade after media reports suggested that the United States Food and Drug Administration (USFDA) has issued Form 483 observations after concluding inspection of Lupin's Mandideep unit in Madhya Pradesh. Tata Steel edged higher on reports that the company's board will meet today, 29 March 2016, where it is widely expected to announce restructuring or selling of some of the European units and job cuts to save costs. In overseas stock markets, European shares reversed initial gains as weakness in oil prices and uncertainty over monetary policy in the United States prompted traders to lock in gains. Earlier during the global day Asian stocks ended on a mixed note ahead of a speech from Federal Reserve Chairwoman Janet Yellen on US economic outlook and monetary policy. Yellen will deliver a speech at the Economic Club of New York today, 29 March 2016. Markets globally expect Yellen to drop hints about future rate hike path.
Elsewhere in the Asia Pacific region: New Zealand's NZX50 added 0.2% to 6676.33. Taiwan's Taiex index slipped 0.8% to 8617.35. South Korea's KOPSI rose 0.6% to 1994.91. Malaysia's KLCI added 0.7% to 1715.04. Singapore's Straits Times index closed 0.4% down at 2819.08. Indonesia's Jakarta Composite index rose 0.2% to 4781.30.
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