Headline equities of the Asia Pacific market mostly advanced on Friday, 17 October 2014, as investors chased for bargain buying after a better than expected US economic data and comments from Fed official underpinned appetite for riskier assets. However, gain on the upside was limited amid lingering concerns about slowing world economic growth.
Appetite for risk assets encouraged after US economic data overnight showed that the number of Americans filing new claims for jobless benefits fell to a 14-year low last week and industrial output rose sharply in September after a fall in the previous month.
Also helping markets were comments from James Bullard, the head of the St. Louis Federal Reserve Bank. St. Louis Fed president James Bullard urged on Thursday that Fed to considering delaying the end of the bond purchase program as inflation expectations were "declining". He added that Fed is watching the developments in the global economy as well as financial markets and Fed stands ready to "defend our inflation target". The so called QE3 was also wound down to USD 15b per month and markets generally expect Fed to bring that down to zero at next meeting. But Bullard said "fifteen billion by itself is not that consequential," and "what consequential is committee intentions on future QE, and we have certainly seen through the taper tantrum how important those can be."
Investors were waiting on speeches from a handful of ECB policymakers for any fresh hints on its easing plans and from Federal Reserve chief Janet Yellen later in the day.
Among Asian bourses
Aussie shares gain for third day
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Australian share market advanced for fourth consecutive day, as investors snapped up cheaper stocks, with banks and financial blue-chips leading the gains. The benchmark S&P/ASX 200 Index and the broader All Ordinaries Index each grew 0.3% to 5271.70 and 5260.10, respectively. For the week, the benchmark S&P/ASX200 jumped 1.6%, while the broader All Ordinaries lifted 1.4%.
Sydney shares started the session with firm footing, note, on tracking slight gains in the U.S. stock market overnight. The gains in local bourses bolstered further as investors bought up banks and other stocks with relatively strong dividend yields.
Shares of banks and financial companies closed higher, with top four lenders leading the way, Commonwealth Bank of Australia advanced 0.8% to A$76.54, ANZ Banking Group 1.1% to A$31.93, Westpac Banking Corp 1.1% to A$33.93, and National Australia Bank 0.8% to A$33.15.
Santos shares gained 0.6% to A$12.72 after reporting a lift in September quarter production and sales revenue. Oil and gas producer revenue jumped 16% to A$2.95 billion in the nine-month period through September from a year earlier and by 3% to A$1.06 billion for the third quarter alone. Quarterly production was 4% higher than a year ago, at 14 million barrels of oil equivalent, bringing output for the nine months to 39 million barrels, up 3% on last year.
Nikkei drops to five-month low on stronger yen
Japanese share market closed the session at lowest level in five months, as yen appreciation against the greenback and growing worries about global economic growth triggered risk aversion selloff. The benchmark Nikkei 225 index at the Tokyo Stock Exchange lost 1.4%, or 205.87 points, to 14532.51. It lost 5% this week. The broader Topix index of all first-section issues was 1.53%, or 18.28 points, lower at 1,177.22 its lowest close since May 22. The Topix gauge dropped 5.3% this week, and has tumbled 13% from a six-year high on Sept. 25, suggesting the market is now in a correction phase.
Tokyo shares started the session with firm footing, on tracking slight gains in the U.S. stock market overnight. But the blue chip shares reversed gain, hit by a stronger yen and growing concerns about the global economy. The dollar was down at 106.16 yen in Tokyo afternoon trade, from 106.33 yen in New York Friday.
Shares of banks and export related companies suffered the most damage on the Tokyo market. Among banks, Mitsubishi UFJ Financial dropped 1.6% to 551 yen and Sumitomo Mitsui Financial Group Inc. declined 2.5% to 3835 yen.
Among exporters, industrial robot maker Fanuc Corp slipped 1.5% to 17695 yen, while chip testing equipment maker Advantest Corp fell 0.8% to 1198 yen. Air-conditioner maker Daikin Industries fell 1.3% to 5962 yen. Canon Inc, the world's biggest camera maker, lost 1.9% to 3180 yen. Panasonic Corp., which gets about half its sales outside of Japan, dropped 0.9% to 1130 yen. Toyota Motor Corp, the world's biggest automaker, slid 2.5% to 5731 yen. Honda Motor Co, a carmaker that gets 84% of sales abroad, dropped 0.9% to 3255 yen. Nissan Motor Co., which gets more than 70% of its revenue abroad, declined 3.7% to 918 yen.
Japan Display tumbled 18% to 359 yen after the company expects a loss of 10 billion yen ($94 million) in the year ending March, compared with a previous forecast for net income of 26.8 billion yen.
Shanghai Composite slips 0.72%
Mainland China share market closed down, on caution before release third-quarter economic growth figures next Tuesday and ahead of next week's Fourth Plenum, an annual meeting of China leaders which may offer clues about plans to address a slowing economy. Investors were also booking profit ahead of subscriptions for new initial public offerings next week. The benchmark Shanghai Composite index declined 15.32 points, or 0.65%, to finish at 2341.18.
Eight out of ten SSE sectors declined, with shares of energy, telecom, utilities, industrial and material companies being major losers.
The China Securities Regulatory Commission said on Wednesday after the market close that it had approved 11 new IPOs six on the Shanghai Stock Exchange, two on the small and medium enterprises board in Shenzhen, and three on the ChiNext board. Nine companies will open their IPOs for subscriptions next week, increasing pressure on market liquidity.
Hang Seng rises 0.53%
Hong Kong equity market closed volatile session modest higher, as the bulls bet on the announcement of the launch date of the long-awaited mutual market access plan between HK and Shanghai. The Hang Seng Index gained 0.53% to 23023.21. The gauge capped a 0.3% weekly decline. The Hang Seng China Enterprises Index advanced 0.5% to 10234.02.
HK shares started the session with firm footing, on tracking slight gains in the U.S. stock market overnight. The blue chip shares extended its gain after the HKEx's CEO Charles Li said all preparation works on Shanghai-HK Stock Connect were ready, raising hopes that the regulators may announce the launch date of the scheme today.
Shares of Macau gaming companies surged on bargain hunting. Sands China (01928) jumped 4.6% to HK$44.5. Galaxy Ent (00027) also put on 4.4% to HK$48.75.
Realty stocks also ended higher in HK. Cheung Kong climbed 1.3% to HK$131, while Swire Pacific Ltd. advanced 1.2% to HK$100.70. China Vanke (02202) jumped 3.2% to HK$14.36.
Kaisa (01638) plunged 6.4% to HK$2.65 on talks that its chairman was detained. But the spokesman for the company denied the rumours.
Tingyi (Cayman Islands) Holding Corp. (322) gained 4.3% to HK$19.58 as the instant-noodle maker extended yesterday's rebound after sliding to its lowest in more than a year on Oct. 15.
Energy stocks climbed on tracking strength in crude oil prices in Asian trade. Cnooc advanced 3.8% to HK$12.46, while PetroChina Co. advanced 1% to HK$9.38.
Sensex gains
Indian stock market closed higher, led by banking, capital goods, consumer durables and power sector stocks amid firm European cues. The 30-share BSE index Sensex gained 109.19 points at 26,108.53 and the 50-share NSE index Nifty moved up by 31.5 points at 7,779.70.
TCS tumbled after as the company's operating profit margin (OPM) dropped on sequential basis in Q2 September 2014 and after the company forecast the current period will be "soft". HCL Technologies slumped as its earnings before interest, taxes, depreciation and amortization (EBITDA) declined 1.1% in Q1 September 2014 over Q4 June 2014. Hero MotoCorp rose in volatile trade after strong Q2 earnings.
Elsewhere in the Asia Pacific region-- South Korea KOSPI declined 0.95% to 1900.66. Taiwan's Taiex index declined 1.4% to 8512.88. Indonesia's Jakarta Composite index rose 1.56% to 5028.95. Malaysia's KLCI gained 1% to 1784.91. New Zealand's NZX50 grew 0.3% to 5146.94. Singapore's Straits Times index added 0.4% at 3167.73.
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