Selloff in the regional indices triggered after the Federal Reserve surprisingly optimistic assessment of the U.S. economy fuelled bets it may start paring stimulus may come sooner rather than later. Meanwhile, selloff in the regional bourses intensified further on weaker than expected corporate results from regional bellwether companies.
The Federal Reserve concluded a two-day meeting on Wednesday. Fed kept its rate unchanged at near zero level and maintained the $85b monthly pace of asset purchase as widely expected. The central bank acknowledged that "fiscal policy is restraining economic growth". But it also noted that "taking into account the extent of federal fiscal retrenchment over the past year, the committee sees the improvement in economic activity and labour market conditions since it began its asset purchase program as consistent with growing underlying strength in the broader economy." And, it reiterated that it will "await more evidence that progress will be sustained before adjusting the pace of its purchases." And, Fed also repeated that it will hold rates near zero "at least as long as" unemployment staying above 6.5% or inflation kept below no higher than 2.5%.
Overall, the statement gave no additional languages on the dovish side which some market participants are looking for. March is still the generally expected time for Fed to taper the stimulus. However, there are some speculations after the statement that Fed would cut back the asset purchase as soon as in January.
Among regional bourses, shares in Sydney market ended slightly weaker, with the benchmark S&P/ASX 200 index falling 0.1% to 5425.50. The decline in Sydney market came as fall in precious metal miners, financials, and property trusts were more than offset by gain in tech, retailers, and utilities stocks.
National Australia Bank sank 2.54% to A$35.31 in Sydney after the lender posted full-year earnings in line with market forecasts, though costs were ahead of expectations.
In Japan, shares in Tokyo market declined, dragging the Nikkei Stock Average down by 174.41 points, or 1.2%, to end the day at 14,327.94, as investors were selling stocks to lock in recent gains following Wall Street losses overnight. Market players were also selling stocks because they were disappointed about the Bank of Japan's decision to leave its current monetary policy unchanged following its policy board meeting that took place the same day.
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The Bank of Japan stuck with its campaign of unprecedented monetary easing as Prime Minister Shinzo Abe seeks to jolt the nation out of a 15-year deflationary malaise. Governor Haruhiko Kuroda's board maintained a pledge to expand the monetary base by 60 trillion to 70 trillion yen ($711 billion) a year, in a decision released in Tokyo today.
Honda Motor lost 1.3% to 3915 yen after the company's posted 120.37 billion yen net profit for the three months ended September, while up from 82.23 billion yen in the same quarter a year earlier, undershot market expectation. Honda Motor maintained its net and operating profit projections for the full year, but that was panned by the market.
Toshiba fell 5.2% to 428 yen after booking a 14% fall in first-half net profit to 21.5 billion yen. It revised up its full-year operating-profit view to 290 billion yen from 260 billion yen.
ANA Holdings closed down 4.7% at 205 yen after the airline lowered its 2013 fiscal-year net profit forecast by 65% on higher fuel costs and slow service expansion because of delays in Boeing 787 Dreamliner deliveries.
GS Yuasa lost 6.1% to 589 yen after posting a first half operating profit of 3.7 billion yen, down 8% on-year and below guidance of 4.0 billion yen.
NEC dropped 5.6% to 220 yen after booking a first half group net loss of 26.15 billion yen, swinging into the red from a profit of 8 billion yen a year earlier.
Fujifilm Holdings jumped 3.2% to 2,393 yen after the firm booked a 31.4 billion yen net profit for the just-ended half-year and also unveiled a one-time 10 yen dividend to commemorate the firm's upcoming 80th anniversary.
In China, shares in the Chinese share market finished lower, weighing the benchmark Shanghai Composite index down by 0.87% to 2141.61, with banks and consumer-staple players leading downfall.
Shares of banks and financials declined in Chinese market on weak weaker than expected earnings from lenders and on worried over lenders NPA. Concerns over NPA rekindled after media report that nonperforming loans at Industrial & Commercial Bank of China, China Construction Bank Corp, Agricultural Bank of China and Bank of China rose 3.5% in the three months to Sept. 30 from June to a combined 329.4 billion yuan.
China Minsheng Banking Corp. slid 2.4% to 8.96 yuan, leading fall among lenders, after reporting third-quarter net income of 10.4 billion yuan ($1.7 billion).
Shares of Chinese consumer-staple producers and health-care companies tumbled. Inner Mongolia Yili Industrial dropped 4.57 yuan to 41.13 yuan, after the company reported weaker than expected third-quarter net income growth of 28.6%. Baiyunshan fell 3.42 yuan to 30.82 yuan after announcing third-quarter net income of 141 million yuan
Property developers shares went up on speculation policy makers won't impose further property curbs after government statement yesterday, about an Oct. 29 study session on housing by the ruling party's decision-making Politburo, didn't mention home prices. Poly Real Estate advanced 1.8% to 9.51 yuan and Gemdale Corp. increased 1.7% to 5.84 yuan.
In Hong Kong, shares in HK market fell down sharply as investors indulged into profit taking following yesterday's strong rally. The benchmark Hang Seng Index declined 97.65 points, or 0.42%, to 23206.37. The Hang Seng China Enterprises Index dropped 13.87 points, or 0.13%, to 10627.02
Among the HK 50 blue chips, 16 stocks rose and 31 fell, with three stocks remaining steady. China Merchants Holdings (International) Co declined 2.3% to HK$27.50 while Hengan International Group Co rose 2.1% to HK$94.95, making themselves the top blue-chip loser and winner.
Shares of Hong Kong listed Chinese financials closed mixed after earnings reports. ICBC (01398) softened 0.7% to HK$5.43. BOC (03988) and ABC (01288) added 1.1% and 0.3% to HK$3.73 and HK$3.63 as their earnings reports were inline with market expectations. Minsheng Bank (01988) dipped 2.4% to HK$8.89 after it reported only 6% growth in 3Q's net.
The HK government announced today expenditure for the period April to September 2013 amounted to HK$201.6 billion and revenue HK$141.5 billion, resulting in a deficit of HK$60.1 billion. A government spokesperson said that the deficit for the period was mainly because some major types of revenue including salaries and profits taxes were mostly received towards the end of a financial year. The fiscal reserves stood at HK$673.8 billion as at 30 September 2013.
In India, Indian benchmark indices edged higher as the market sentiment was boosted by data showing that foreign funds remained net buyers of Indian stocks on Wednesday, 30 October 2013. The barometer index, the S&P BSE Sensex, settled at record high above the psychological 21,000 mark after almost kissing its record high hit in 2008 in late trade. The S&P BSE Sensex was up 130.55 points or 0.62% to 21,164.52, a record closing high.
The market sentiment in India was boosted by data showing that foreign funds made substantial purchases of Indian stocks on Wednesday, 30 October 2013. Foreign institutional investors (FIIs) bought shares worth a net Rs 1035.50 crore from the secondary equity markets on Wednesday, 30 October 2013, as per data from Securities & Exchange Board of India.
Elsewhere in the region, New Zealand's NZX 50 index rose 0.86%. Indonesia's Jakarta Composite index declined 1.4%. South Korea's KOSPI sank 1.4%. Taiwan's Taiex index lost 0.2%. Malaysia's KLSE Composite shed 0.6%. Singapore's Straits Times index dropped 0.6%.
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