Asia Pacific shares closed mostly down on Tuesday, 04 November 2014, on Wall Street overnight slip, disappointing Chinese data, and concerns over euro zone dampening the mood. The MSCI Asia Pacific Excluding Japan Index dropped 0.5% to 483.42.
Risk sentiments across the regional markets were subdued on persistent worries about slowing economic growth in China, after manufacturing and services industries showed signs of a broadening slowdown in the world's second-largest economy. HSBC final manufacturing purchasing managers index for China moved higher to 50.4 compared with 50.2 in September, though unchanged from its initial reading. In contrast, China's official manufacturing gauge, released on Saturday, came in at a five-month low of 50.8 for October, compared with 51.1 in September. China's government's non-manufacturing Purchasing Managers' Index fell to 53.8 last month from 54 in September.
The downbeat mood deepened on concerns over euro zone growth after the European Commission cut its growth forecasts. The economy in the 18-nation Eurozone is forecast to expand just 0.8% this year and 1.1% in 2015, according to the latest estimate from the European Commission, the region's executive body. The figures were down from a spring forecast of 1.2% growth this year and 1.7% in 2015.
Among Asian bourses
Aussie market rises 0.2%
Australian share market finished slight higher in subdued trade, as poor trade figures and an upward revision to recent unemployment figures overshadowed strong growth in retail spending. The benchmark S&P/ASX 200 Index and the broader All Ordinaries Index each added by 0.2% to 5519.9 points and 5498.2 points, respectively.
The RBA board kept the official interest rate at its record low 2.5%, for the 15th month in a row. Australian Bureau of Statistics data showed a surprise blow out in the trade deficit to A$2.2 billion in September. A separate ABS report showed retail sales rose 1.2% in September, sharply above the street expectation.
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Shares of Woolworths continued to fall after its weaker than expected first quarter sales figures, shedding 2.8% to A$33.30. Most other retailers picked up after the strong spending data, with Harvey Norman adding 0.5% to A$3.74, Super Retail up 2.6% at A$7.12. Domino's Pizza was 2.9% higher at A$27.75.
Two of the major banks were the main drag on the market, with National Australia Bank falling 0.8% to A$34.61, while Australia and New Zealand Banking Group up 0.2% at A$33.65. Westpac Banking Corp fell 0.1% to A$34.50 but Commonwealth Bank of Australia gained 0.3% to A$80.77.
Nikkei zooms to seven-year high
Japanese share market closed the session at highest level in seven months, on continued broad-based buying across the sector, buoyed by last week's unexpected decision from the Bank of Japan to increase its program of quantitative easing. The benchmark Nikkei Stock Average gained 2.73%, or 448.71 points, to 16862.47, the best close since late 2007.
The yen was trading at 113.33 yen, down from 113.99 yen in New York overnight but still up from 112.72 yen late Monday in Asian trade, following the BOJ decision to pump even more money into the economy after a second-quarter contraction. A weak yen is good for Japanese exporters as it makes them more competitive abroad and inflates their repatriated profits.
The Bank of Japan said on 31 October 2014 that it raised its target for annual purchases of Japanese government bonds to 80 trillion yen ($706 billion), while tripling buying of real estate investment trusts. On the same day, the Government Pension Investment Fund set allocation targets of 25% each for Japanese and overseas equities, up from 12% each. GPIF will cut domestic bonds to 35% of assets from 60%.
Shares of export-related stocks advanced the most in Tokyo, as the Bank of Japan's announcement Friday to widen its asset-purchase scheme sent the yen tumbling to 114 against the dollar. Sony jumped 11.05% to end at 2,301.0 yen, Panasonic soared 5.97% to 1,383.0 yen, camera maker Olympus was up 5.36% at 4,125.0 yen, while Sharp's gains were more modest, rising 2.55% to 281 yen.
Shanghai Composite holds 21-month high
Mainland China share market closed at fresh 21-months peak, on the back of rotational buying in highly-capitalized stocks with low share prices, led by industrial companies, on speculation the government is planning a $16.3 billion fund to finance construction of infrastructure along a centuries-old Silk Road trading route. Investors shrugged off a mixed picture of October's economic activity. The benchmark Shanghai Composite Index, which tracks both A and B shares, ended 0.03% up at 2430.68, its highest close since 8 February 2013 when it finished at 2432.40.
Shares of industrial companies advanced the most in Shanghai index, led by Sany Heavy Industry Co, raising 7.5% to 6.56 yuan, on reports that China plans to set up a fund worth about 100 billion yuan to finance construction of infrastructure to link domestic and foreign markets. The funds will be used to build and expand railways, roads and pipelines in Chinese provinces that are part of the strategy to facilitate trade over land and shipping routes. China Railway Construction Corp, part of a group that won a $4.3 billion Mexican contract, advanced more than 8.3% to 7.05 yuan.
Shares of Railway companies were also higher on winning overseas contracts and hopes of more domestic rail projects as the government seeks to boost the economy through infrastructure investment. China Railway Construction Corp surged 8.29% to 7.05 yuan while Norinco International jumped by its 10% daily up limit to 20.12 yuan.
Banks shares lost steam following recent gains. Ping An Bank lost 2.34% to 10.85 yuan while Huaxia Bank eased 1.48% to 8.67 yuan.
Hang Seng ends 0.29% down
Headline equities of the Hong Kong market finished mostly down in volatile trade, due to negative lead from Wall Street overnight and on profit-taking in response to last week's healthy gains and on worries about slowing economic growth in China. The Hang Seng Index fell 0.29%, or 70.31 points, to 23845.66. Turnover increased to HK$70.8 billion from HK$64.3 billion on Monday.
Shares of HSBC fell 0.51% to $HK78.25 after the global bank posted a mixed third-quarter earnings report and said it had set aside $US378 million for a potential fine in Britain to settle allegations of foreign exchange market rigging.
Casino plays were down after data showed Macau gross gaming revenues fell 23.2% to MOP28 billion in October. Galaxy Entertainment Group eased 2.8% to $HK52.40 and Sands China sank 3.3% to $HK46.80. Wynn Macau (01128) fell 3.4% to HK$27.25.
Railway infrastructure construction firms were higher on strong buying orders. China Comm Con (01800) soared 9% to HK$6.57. China Railway (00390) and China Rail Cons (01186) rose 4.3% and 3.6% to HK$5.04 and HK$8.35.
Heavy machinery and capital equipment makers also ended higher. Zoomlion (01157) shot up 15.5% to HK$4.33. Longking (03339) and Sany (00631) jumped 7.5% and 6.2% to HK$1.43 and HK$1.88.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index fell 0.17% to 8989.18. South Korea KOSPI fell 0.91% to 1935.19. Malaysia's KLCI sank 0.32% to 1847.36. New Zealand's NZX50 rose 0.1% to 5423.26. Singapore's Straits Times index slipped 0.28% at 3281.57. Indonesia's Jakarta Composite index dropped 0.3% to 5070.94. Indian stock market closed for public holiday.
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