Among Asian bourses, Japan's share market finished the last trading session of Calendar Year 2013 at their highest level in six years, as a significant weakening for the yen carried blue-chip exporter stocks higher. The benchmark Nikkei Stocks Average grew 112.37 points, or 0.69%, to finish the session at 16291.31, highest closing level since Nov. 2, 2007. The benchmark surged about 57% higher than its 2012 close of 10,395.18.
A weaker Japanese currency has helped to propel stock prices higher, boosting profits in Japan's export-oriented corporate sector. Policies that have spurred yen weakness are part of Prime Minister Shinzo Abe's plan to revive the country's long-stagnant economy. In recent weeks, the yen's move downward regained momentum, with the U.S. Federal Reserve's decision to start to wind back its bond-buying program and greater expectations of further stimulus from the Bank of Japan. The yen was trading at 105.32 yen per dollar on Monday, compared with 105.16 yen late Friday in New York.
Export related shares were biggest winner in the Tokyo market due to softening of Yen against the US dollar. Exporters benefit from being able to sell goods more cheaply overseas with a weaker yen.
Nikon Corp rose 1.31%, NEC Corp added 3.04%, and Mazda Motor Corp improved 0.37%. Sony Corp. advanced 2.30% on report that Sony would cancel the planned sale of its battery operations.
Shares of Japan Tobacco Inc fell 0.44% on reports that the firm would pass on the 3% hike in sales tax, planned for April, to its customers.
Maruha Nichiro Holdings Inc shares 2.66% fell 4.3% on reports one of its units was recalling millions of food items after the detection of the pesticide malathion.
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Nippon Paper slid 5.9% on reports the firm's operating profit in the nine months through December probably dropped 3% from the same period a year earlier.
In Australia, Australian share market finished slight higher, lifted by gains in heavyweight shares of metal & mining, financials, and energy companies. , the benchmark S&P/ASX 200 index rose 32.70 points, or 0.61%, to 5356.80. The broader All Ordinaries added 34.20 points, or 0.64%, to 5358.
Australian metal & mining companies were stronger on the back of firmer commodity prices including a 2% gain for London copper futures and a 1.4% rise for spot iron ore. BHP Billiton added 1.3% to A$38.02 and Rio Tinto 1% to A$68. Fortescue Metals Group rose 1.92% to A$5.85 despite suspending work at its Christmas Creek iron mine following the death of a worker there. Likewise, Oz Minerals climbed up 0.33% to A$3.07, Evolution Mining 5.13% to A$0.62 and Alumina 0.32% to A$1.09.
Coal miners were higher, with Guildford Coal gaining 1.2% at A$0.083 as the company announced it will save A$2.2 million having renegotiated an agreement made in 2012 to buy a 51% share in the Springsure coal asset. Jameson Resources rose 2.1% to A$0.245 as it had two new coal mining licenses approved for its Dunlevy tenure in British Columbia, while Stanmore Coal lost 2.6% to A$0.185 as it received A$680, 000 in exploration funding from Japanese company Taiheiyo Kouhatsu and the Japan Oil, Gas and Metals National Corporation for its Belview coking coal project in Queensland.
Leighton Holdings (LEI) shares added 0.9% to A$16.11 after announcing the company has taken full ownership of its Indian-based joint venture Leighton Welspun. Leighton will rename the business Leighton India and says its 2013 underlying profit will not be affected by the transaction.
Shares in construction firm Forge Group (FGE) soared 54.6% to A$1.585 after the company received the go-ahead for more work at Gina Rinehart's Roy Hill iron ore mine in Western Australia. The contract is worth A$830 million to FGE. Last week, FGE shares rose 65%.
In China, China's financial market finished weaker, as investors cashing in profit following sharp rally previous session. The Shanghai Composite declined 3.72 points to finish at 2097.53, while the CSI 300 Index shed 4.02 points to close at 2299.46.
The decline in the Mainland China financial market came amid lingering liquidity concerns in spite of government pledge to keep liquidity and financial markets stable next year. Premier Li Keqiang said China will keep liquidity at an appropriate level in 2014 to maintain the stability of financial markets and the broader economy, according to a statement published on the website of the State Council late on Sunday. Li's statement came after cash crunches in China's money markets early this month. The central bank initially did not make large cash injections to help banks cope with elevated cash demand at the year-end. We will stick to the prudent monetary policy, keep appropriate liquidity, realize reasonable growth in credit and total social financing and keep prices largely stable, Li was quoted as saying.
Chinese financial and property counters led losses among industry groups. Bank of China fell 1.9% to 2.61 yuan. Bank of Communications, part-owned by HSBC Holdings Plc, sank 2.3% to 3.80 yuan. Poly Real Estate, the second-biggest developer, slumped 1.6% to 8.03 yuan. China Vanke, the country's largest developer by sales, fell 1.7% in Shenzhen.
Materials and resources players were also weak. Jiangxi Copper, China's biggest producer of the metal, fell 0.9% to 14.02 yuan, extending this year's slump to 41%. Yanzhou Coal Mining Co. dropped 0.8% to 8.74 yuan and has declined 52% this year.
Shares of telecommunication companies went higher on reports China plans to invest 100 billion yuan in fourth-generation mobile networks in 2014. Fiberhome Telecommunication rose 2.1% to 15.38 yuan. ZTE Corp, the second-biggest phone-equipment maker, added 1% to 13.23 yuan.
In Hong Kong, shares in the city bourse closed the session slight higher in quiet yet volatile trade, as initial gains inspired by strong data on U.S. third-quarter growth and the job market were partly offset by profit taking in late afternoon. The benchmark Hang Seng Index was provisionally ending 1.63 points higher at 23244.87, while Hang Seng China Enterprises Index fell 59.41 points to 10770.69.
Investors returned to the HK market with positive note after weekend break, as recent strong data on U.S. third-quarter growth and the job market buoyed the global economic outlook. But most of the early gains were dissipated amid weakness in the Chinese financial and property stocks listed in Hong Kong index on liquidity concerns.
Among the HK 50 blue chips 15 rose and 32 fell, with three stocks remaining steady. Tencent (00700) gained 2.6% to HK$495.8, while China Coal (01898) dipped 2.5% to HK$4.34, making themselves the largest blue-chip gainer and loser respectively.
Shares of gaming related companies rose after reports China's computer games' sales rose 38% year-on-year. Kingsoft (03888) jumped 3.8% to HK$21.65, while Sinosoft Tech (01297) soared 17.5% to HK$1.95.
Shares of coal miners were weak despite coal prices rose to highest level since June. China Shenhua (01088) and Yanzhou Coal (01171) softened 1% and 1.7% to HK$24.2 and HK$7.07
Cathay Pacific Airways rose 1.11% to HK$16.46 as the Hong Kong-based airline said Friday it ordered four additional airplanes from Boeing Co valued at approximately $1 billion at current list prices.
On the economic front, the values of Hong Kong's total exports and imports of goods both showed year-on-year increases, at 5.8% and 5.2% respectively, in November, data from the Census and Statistics Department showed.
The value of total exports of goods (comprising re-exports and domestic exports) rose 5.8% over a year earlier to HK$325.5 billion In November, after a year-on-year increase of 8.8% in October. Within this total, the value of re-exports grew 6% to HK$320.9 billion in November, whereas the value of domestic exports dropped 10.4% to HK$4.6 billion. Concurrently, the value of imports of goods rose 5.2% over a year earlier to HK$370.1 billion in November, after a year-on-year increase of 6.3% in October. A visible trade deficit of HK$44.6 billion, equivalent to 12% of the value of imports of goods, was recorded in November.
For the first 11 months of 2013 as a whole, the value of total exports of goods rose 4% over the same period in 2012. Within this total, the value of re-exports grew 4.2%, whereas the value of domestic exports fell 7.6%. Concurrently, the value of imports of goods rose 4%. A visible trade deficit of HK$446.7 billion, equivalent to 12.1% of the value of imports of goods, was recorded in the first 11 months of 2013.
In Indonesia, shares in the Indonesian market closed at highest level in nearly three weeks amid selective buying in large-caps, ending 2013 with their first yearly loss since 2008. Jakarta's Composite Index finished up 1.5% at 4,274.18, the highest close since Dec. 10. The index was down 1% in 2013, amid concerns about Indonesia's current account deficit and a plan by the U.S. Federal Reserve to reduce its stimulus programme, beginning in January. Indonesia will be closed on Tuesday and Wednesday for New Year holidays.
Indonesia's stock exchange recorded about 21 trillion rupiah ($1.71 billion) of net foreign selling so far in the year to Dec. 27, according to Thomson Reuters data.
In India, Indian benchmark indices edged lower after Reserve Bank of India (RBI) Governor Raghuram Rajan said that the commencement of tapering by the US Federal Reserve will mean a repricing of certain assets with consequent volatility in the global financial markets and that a potential additional source of uncertainty for India is the coming general election. Investor sentiment was hit adversely after the RBI's latest financial stability report (FSR) said that the risks to the Indian banking sector have further increased since the publication of the previous FSR in June this year.
Increase in Brent crude oil prices also hit sentiment adversely. Higher crude oil prices stoked worries of increase in current account deficit and the government' fiscal deficit. India imports around 80% of its domestic oil requirement. Lower European stocks also dampened sentiment.
As per provisional figures, the S&P BSE Sensex was down 63.02 points or 0.3% to 21,130.56. The index declined 104.37 points at the day's low of 21,089.21 in late trade, its lowest level since 26 December 2013. The index jumped 111.12 points at the day's high of 21,304.70 at the onset of the trading session, its highest level since 10 December 2013.
In his foreword of the central bank's Financial Stability Report (FSR) - December 2013 released today, 30 December 2013, RBI Governor Raghuram Rajan said that the commencement of tapering by the US Federal Reserve will mean a repricing of certain assets with consequent volatility in the global financial markets and that a potential additional source of uncertainty for India is the coming general election. A stable new government would be positive for the economy. With confidence in the financial system still fragile, six years into the crisis, policy certainty is something investors look for in the current environment, Rajan said.
The RBI governor said that the outlook for the economy has improved, with export growth regaining momentum, but growth is still weak. The challenges of containing inflationary pressures limit what monetary policy can do, he said. It is imperative that long-delayed legislative reforms are pushed through, stalled infrastructure project clearances continue and fiscal consolidation remains on track, Rajan said.
The current level of non-performing assets in the Indian banking system do not pose a systemic concern as the CRAR of the banking system is above the prescribed levels and many projects are just delayed, not unviable, Rajan said. But we cannot be complacent, he added. The stress tests assume extreme conditions and tail events and show that the financial system in India is resilient to stresses at this point in time though continued vigilance is warranted, Rajan said.
Elsewhere in the region, South Korea's KOSPI rose 0.45%. Taiwan's Taiex index rose 1.04%. New Zealand's NZX50 index edged 0.03% up. Singapore's Straits Times index added 0.45%. Malaysia's KLSE Composite rose 0.62%.
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