Asia Pacific share market ended mostly down on Friday, 09 September 2016, as risk sentiments dampened on tracking the negative lead from Wall Street overnight, confirmation of North Korea fifth nuclear test, and on disappointment over the European Central Bank's interest rate decision.
On Wall Street, stocks closed modestly lower on Thursday following the European Central Bank's decision to leave interest rates unchanged. The ECB reiterated that its monthly asset purchases of 80 billion euro are intended to run until the end of March 2017, or beyond, if necessary. The Dow dipped 46.23 points or 0.3% to 18,479.91, the Nasdaq fell 24.44 points or 0.5% to 5,259.48 and the S&P 500 edge down 4.86 points or 0.2% to 2,181.30. The major European markets finished mixed on Thursday. While the U.K.'s FTSE 100 Index edged up by 0.2%, the French CAC 40 Index dipped by 0.3% and the German DAX Index dropped by 0.7%.
The North Korean test put a worrisome spin on Asian markets with traders already fretting about the European Central Bank's decision Thursday not to expand its stimulus program, defying expectations. North Korea conducted a fifth nuclear test hours after President Barack Obama wrapped up a tour of Asia, highlighting the U.S.'s struggle to rein in the rising threat from dictator Kim Jong Un. Pyongyang declared a successful test hours after the U.S. Geological Survey detected a magnitude 5.3 earthquake near North Korea's nuclear test site in the country's northeast early on Friday, a reading that surpassed the magnitudes of tremors set off by the country's previous nuclear tests. North Korea confirmed in a statement released through its state media that it conducted a test explosion of a nuclear warhead. It said the test was successful and confirmed its ability to produce nuclear-tipped missiles at will. It added that it would continue to build up its nuclear force in quality and quantity.
Risk sentiments also subdued amid heightened concerns that the Federal Reserve would raise interest rates sooner than later, which can boost the U.S. dollar and make debt denominated in the currency more expensive to emerging markets.
Among Asian bourses
ASX200 drops 0.87%
Also Read
Australian share market closed down on tracking the negative lead from Wall Street overnight and on disappointment over the European Central Bank's interest rate decision. All but two ASX sectors declined, with realty, healthcare, and financial issue leading falls. At close of trade, the benchmark S&P/ASX 200 index was down 46.60 points, or 0.87%, to 5,339.20, while the broader All Ordinaries index has lost 44.10 points, or 0.8%, to 5,440.50. Falling stocks outnumbered advancing ones on the Australia Stock Exchange by 620 to 457 and 319 ended unchanged. The S&P/ASX 200 VIX, which measures the implied volatility of S&P/ASX 200 options, was up 12.58% to 15.191 a new 1-month high.
Banks and financials ended softer. The big four banks - Commonwealth Bank of Australia, Westpac, National Australia Bank and ANZ Bank - were lower in a range of 0.9% to 1.3%.
Shares of materials and energy companies advanced. In the mining space, BHP Billiton rose 0.9%, Rio Tinto 0.2% and Fortescue Metals 1%. Among oil stocks, Oil Search rose 2%, Woodside Petroleum 0.2% and Santos almost 2% following the increase in crude oil prices overnight.
Shares in Origin Energy leapt 5.5% after new chief executive Frank Calabria, who replaces Grant King, confirmed that he will continue the company' focus on reducing debt and lifting shareholder returns.
Sigma Pharmaceuticals shares closed 9% higher, adding Thursday's 11% rise after the company lifted its earnings guidance and reported a solid half-yearly profit figure.
Defense and ship builder Austal bounced 5.4% following the successful delivery of its second high speed support vessel to the royal navy of Oman.
Japan Stocks closed mixed
The Japan share market ended mixed after a volatile ride, as concerns over a North Korean nuclear test countered hopes for additional easing measures from the bank this month. Notable issues that gained by the close of play comprised marine transportation and mining-related issues. But those that lost ground were led by food and fishery, and agriculture and forestry-linked stocks. The Nikkei average added 7 points, or 0.04%, to end at 16965.76. The Topic index eased 2.09 points, or 0.16%, to end at 1343.86. Falling stocks outnumbered advancing ones on the Tokyo Stock Exchange by 1099 to 800 and 157 ended unchanged. The Nikkei Volatility, which measures the implied volatility of Nikkei 225 options, was down 6.10% to 20.46.
Energy shares climbed as crude headed for a weekly surge of more than 6% following an unexpected drop in U.S. stockpiles. Petrochemical-products maker Showa Denko KK was among the biggest gainers on the Nikkei 225 Stock Average, climbing 5%.
Bowling-alley operator Round One Corp. tumbled 6% after August same-store sales dropped 4.6% from a year earlier.
Kyocera Corp. added 1.9% after BNP Paribas SA raised its rating on the electronics equipment manufacturer to hold from reduce.
China Market falls after August inflation readings
Mainland China stock market closed lower after official released data confirming its producer prices continued to drop in August, signaling flagging demand in the world's second-largest economy, albeit at a slower pace. The CSI300 index of the largest listed companies in Shanghai and Shenzhen eased 0.64%, to 3,318.04 points, while the Shanghai Composite Index lost 0.55% to 3,078.85 points. For the week, the CSI300 index gained 0.1 percent while the SSEC edged up 0.4 percent.
China's producer price index (PPI), which measures costs for goods at the factory gate, posted a milder decline in August due to a low comparison base, official data showed. The PPI dropped 0.8 percent year on year in August, a narrower decrease than the 1.7 percent in July, the National Bureau of Statistics (NBS) said on Friday. The reading marked the 54th straight month of decline as China's economic slowdown and industrial overcapacity weighed on prices.
Also, growth in China's consumer price index weakened for the fourth consecutive month in August to indicate the lowest inflation rate in almost a year, which analysts said leaves room for China to loosen its monetary policy to stabilize economic growth. The CPI rose by 1.3 percent year-on-year, which is the lowest rise since October and down from 1.8 percent in July. The slackening growth can be attributed to falling food prices, the National Bureau of Statistics said in a statement on Friday.
Hong Kong Market rallies 0.75%
The Hong Kong stock market closed higher despite wider losses in the region, after a Chinese regulator said it would allow domestic insurers to invest in Hong Kong-listed stocks through a trading link with Shanghai. The China Insurance Regulatory Commission's announcement came less than a month after Beijing confirmed it would launch the Shenzhen-Hong Kong Stock Connect program within 2016. The benchmark Hang Seng Index advanced 180.36 points, or 0.75%, to 24099.70 points. The Hang Seng China Enterprises Index, a benchmark measure of performance of mainland China enterprises, rose 49.76 points, or 0.5%, to 10057.97. Turnover soared to HK$116.8 billion from HK$77.3billion on Thursday. The Hang Seng was up 0.8% for the week and has risen nearly 20.6% in the past six months.
The CIRC's message implies that hundreds of billion funds from mainland insurers may flow to HK. HKEx (00388) soared 5.5% to HK$209.6. It was the top blue-chip gainer.
Chinese brokerages were also chased by investors. CGS (06881) added 2.7% to HK$7.9. HTSC (06886) put on 2.1% to HK$17.7. CITIC Sec (06030) climbed 2.4% to HK$18.1. Local brokers were also higher. Bright Smart (01428) soared 11.5% to HK$3.19 as the company disclosed that it has been approached by potential investors in the company from time to time.
Apple's iPhone 7 failed to trigger strong market response. Its supply chain OEMs retreated across the board. AAC Tech (02018) slid 4% to HK$86.6. It was the biggest blue-chip loser. Cowell (01415) plunged 5% to HK$2.95. Sunny Optical (02382) declined 4.9% to HK$38.6.
Sensex, Nifty hit lowest closing level in a week
Metal, auto sector stocks and index heavyweights ITC and HDFC led losses for key benchmark indices. The barometer index, the S&P BSE Sensex, lost 248.03 points or 0.85% to settle at 28,797.25. The Nifty fell 85.80 points or 0.96% to settle at 8,866.70.
Yes Bank dropped after the bank announced deferring its proposed qualified institutional placement (QIP) of shares.
Steel Authority of India edged lower after the company reported higher net loss in Q1 June 2016 compared to net loss in Q1 June 2015.
Jindal Steel & Power dropped after the company reported higher net loss in Q1 June 2016 compared to net loss in Q1 June 2015.
IDBI Bank rose 5.22% on reports that Asian Development Bank (ADB) has held talks with the government to acquire stake in the state-run bank.
Elsewhere in the Asia Pacific region: New Zealand's NZX50 fell 0.9% to 7468.60. South Korea's KOSPI index fell 1.3% to 2037.87. Taiwan's Taiex index slumped 2.3% to 9053.69. Singapore's Straits Times index shed 0.7% to 2873.33. Indonesia's Jakarta Composite index shed 1.7% to 5281.92. Malaysia's KLCI eased 0.3% to 1686.44.
Powered by Capital Market - Live News
Disclaimer: No Business Standard Journalist was involved in creation of this content