Asia Pacific share market advanced after recouping early losses on Tuesday, 10 May 2016, with Tokyo bourses leading the regional market rally after official warning of government intervention against a sharp rise in the yen.
The Japanese currency weakened against the greenback after Japanese Finance Minister Taro Aso statement on Monday that the government is ready to intervene in the currency market if the yen continues to rise or falls rapidly against other currencies. The minister reiterated those views again on Tuesday, saying it would be natural for the government to intervene if the yen were to gain abruptly against the U.S. dollar. A strong local currency puts pressure on the earnings of exporters because it can make their goods more expensive overseas.
Oil prices advanced in the afternoon during Asian hours on Tuesday, after tumbling nearly 4 percent on Monday in the U.S. session. Global benchmark Brent retraced losses to trade up 0.85 percent at $44 a barrel, while U.S. crude futures were up 0.39 percent at $43.61.
Among Asian bourses
Australia Market rises as investors turn on realty, financials
Australian share market ended higher after recouping initial losses, as gains in property trusts, financial, realty and telecom services sectors were more than offset by losses elsewhere. At close of trade, the benchmark S&P/ASX 200 advanced 22.10 points, or 0.42%, to 5342.80. The broader All Ordinaries grew 16.10 points, or 0.3%, to 5403.90. Falling stocks outnumbered advancing ones on the Australia Stock Exchange by 595 to 454 and 346 ended unchanged. The S&P/ASX 200 VIX, which measures the implied volatility of S&P/ASX 200 options, was up 3.16% to 18.306.
The banks and financial stocks extended gains, with Westpac Banking Corp up 0.6% to A$31.30, National Australia Bank up 1.7% to A$28.92, Commonwealth Bank up 2.9% to A$78, and ANZ Banking Group up 1.3% to A$24.70.
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Metal mining stocks extended losses for second straight session, hurt by weaker nickel and iron ore prices after Sunday's trade data print in China pointed to weak demand in the world's second-biggest economy. BHP Billiton declined 0.6% to A$17.83 and Rio Tinto was down 1.3% to A$45.40. Fortescue Metals fell 0.2% to A$2.85. Sims Metal Management fell 10.11% to A$8.450. Bluescope Steel declined 7.7% to A$5.850.
Incitec Pivot rose 9.79% to A$3.140 at the close. The fertiliser and explosives maker posted a 79 per cent fall in first-half profit.
Nikkei extends gain as yen weakens
The Japan share market advanced for second straight session on Tuesday, 10 May 2016, as investors continued hunting for recently battered stocks, thanks to yen depreciation against the greenback. The Japanese currency weakened against the greenback after Japanese Finance Minister Taro Aso statement on Monday that the government is ready to intervene in the currency market if the yen continues to rise or falls rapidly against other currencies. The minister reiterated those views again on Tuesday, saying that the yen's rise was one-sided, further unwinding the currency's strength. Total 31 out of 33 TSE sectors advanced, led by financial stocks, insurance, and glass and ceramic product issues. The 225-issue Nikkei Stock Average ended up 349.16 points, or 2.15%, from Monday at 16,565.19. The broader Topix index of all First Section issues on the Tokyo Stock Exchange finished 28.24 points, or 2.16%, higher at 1,334.90. On the First Section, advancing issues outnumbered declining ones 1,663 to 240, while 48 ended the day unchanged.
The weaker yen boosted up export-oriented names. A weaker yen is usually a positive for exporters as it improves their overseas profit numbers when converted to local currency. Among exporters, Mazda Motor rose 62.50 yen, or 3.7%, to 1,750.50 yen and Sony gained 78.00 yen, or 3.0%, to 2,681.50 yen.
Hoya gained 114 yen, or 2.9%, to 4,041 yen after the manufacturer of information technology-related glass products reported on Monday a record group net profit for fiscal 2015, citing strong overseas demand in its eyewear lens sector.
Asics climbed 229 yen, or 10.7%, to 2,362 yen after the sporting goods manufacturer reported on Monday a year-on-year increase in its consolidated net profit for the three months through March on brisk sales of running shoes overseas.
Gas equipment maker Rinnai increased 260 yen, or 2.7%, to 9,930 yen after it reported on Tuesday a year-on-year growth in its group net profit for the year ended March helped by strong water heater sales both in Japan and overseas.
China Market closes flat
Mainland China stock market finished the session virtually flat, after fluctuating in and out between boundary line, as data showed consumer inflation unchanged for the third consecutive month but while producer deflation showed further signs of moderating. Total 5 out of10 SSE sectors advanced, with shares of consumer staples and industrial issues being major gainers, while IT issue being major losers. The benchmark Shanghai Composite Index added 0.48 point, or 0.02%, to 2832.59. The CSI 300 Index, measuring exchanges in Shanghai and Shenzhen, added 3.49 points, or 0.11%, to 3069.11.
The latest data on China's inflation refueled the debate over whether the central bank now has the room to turn more cautious about future monetary policy easing. Consumer prices rose slightly less than expected in April, while producer deflation showed further signs of moderating thanks to a bounce in commodity prices that is now rapidly fizzling.
Shares of consumer companies advanced, with automakers paced gains after data from the China Passenger Car Association showed nation's passenger-vehicle sales rose for the eighth time in nine months. Guangzhou Automobile Group Co. climbed 4.2%, while Chongqing Changan Automobile Co. advanced 1.9%.
Shares of shipping companies rallied, with China Cosco Holdings Co. jumping 7.4% and China Shipping Container Lines Co. soaring by the 10% daily limit. In December, China reshaped its shipping industry by announcing a plan to reorganize the two major groups with combined revenue of more than $40 billion.
Hong Kong Market rises 0.43%
The Hong Kong stock market finished higher in volatile trade. The benchmark index opened down 194 points at 19,962, which marked the intra-day low. It then gradually recovered its losses as China's April PPI contraction eased. . The benchmark Hang Seng Index gained 85.87 points, or 0.43%, to 20242.68 points. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, grew 35.44 points, or 0.42%, to 8486.16. Turnover increased to HK$59.8 billion from HK$54.6 billion on Monday.
Cheung Kong group companies led the rally in the city bourses. Power Assets (00006) may consider whether to declare a special dividend on Thursday. It gained 1.4% to HK$77.55. CKH Holdings (00001) added 1.4% to HK$93.85 even though market talks of EU may reject its proposed acquisition of O2 this week. CKI Holdings (01038) rose 1.3% to HK$75.45. But CK Property (01113) fell 1% to HK$48.1.
Public utilities counters also outperformed. CLP (00002) advanced 1.2% to HK$73.7. HK and China Gas (00003) edged up 0.6% to HK$14.62.
Lenovo (00992) plunged 8.3% to HK$5.23. HSBC Research chopped its target price for the PC maker, while JP Morgan also lowered its 2017 and 2018 earnings forecasts.
Cathay Pacific (00293) jumped 1.5% to HK$12.28 on talks that the local carrier intends to acquire a 25.9% stake in Virgin Australia. HKEx (00388) inched up 0.6% to HK$185.8 ahead of earnings report tomorrow.
Sensex gains for the second straight day
Gains in global stocks aided small upmove for key benchmark indices. The barometer index, the S&P BSE Sensex, rose 83.67 points or 0.33% to settle at 25,772.53. The Nifty gained 21.75 points or 0.28% to settle at 7,887.80.
Shares of FMCG giant Hindustan Unilever (HUL) edged higher after the company's Chief Financial Officer P.B. Balaji was quoted as saying after the announcement of the company's Q4 March 2016 results yesterday, 9 May 2016, that he expects a sequential improvement in the company's sales volume growth in Q1 June 2016. Hindalco Industries fell on worries that increase in Chinese output could further weigh on global aluminium prices. JSW Steel edged lower on reports that the company is among seven bidders shortlisted for Tata Steel's UK assets. Shares of microfinance firm Ujjivan Financial Services made a modest debut on the bourses.
Elsewhere in the Asia Pacific region: New Zealand's NZX50 was up 0.4% to 6909.40. South Korea's KOSPI index added 0.8% to 1982.50. Taiwan's Taiex index rose 0.3% to 8156.29. Malaysia's KLCI grew 0.2% to 1635.84. Indonesia's Jakarta Composite index gained 0.3% to 4763.12. Singapore's Straits Times index fell 0.9% to 2741.15.
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