Asia Pacific shares were mostly advanced on Monday, 12 October 2015, as risk sentiments boosted up by tracking rally in the US equity markets on last Friday and as the China's fresh steps to inject liquidity into the struggling economy. MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.8%.
Buying sentiments also bolstered on increasing possibilities that the U.S. Federal Reserve wouldn't raise interest rates later this year. Fed vice chair Stanley Fischer said over the week end that its "an expectation" that Fed will hike interest rate this year, "not a commitment". He emphasized that "both the timing of the first rate increase and any subsequent adjustments to the federal funds rate target will depend critically on future developments in the economy". And, there are still "considerable uncertainties" around the economic outlook, including recent drop in job growth. Nonetheless, he talked down the impact of the international developments including China as "we do not currently anticipate that the effects of these recent developments on the US economy will prove to be large enough to have a significant effect on the path for policy."
Turnover across the region was relatively lower than their daily average ahead of Chinese export data due Tuesday and speeches from Fed officials. Investors were also concerned about the threat of slowing global growth even though central banks have pumped billions of dollars into their economies.
Among Asian bourses
Australia market falls on profit taking
The Australian share market finished softer on first trading session of the week, as investors opted for withdrawing profit off the table after 4.5% gain in the previous week. Most of the ASX industry blue-chip stocks declined, with energy producers were the worst performers amid profit booking following the sector's double-digit gains last week. The benchmark S&P/ASX 200 index lost 46.80 points, or 0.9%, to 5232.90 points, while the broader All Ordinaries index sank 41.80 points, or 0.8%, to 5267.40 points.
Shares of oil explorer companies were top losers in the Sydney financial market today, as investors took profit following the sector's double-digit gains last week, even as oil prices continued to rise during Asia trading. Among energy stocks, Woodside Petroleum declined 1.8% to A$32.02, Origin Energy 3.5% to A$6.27, Santos 0.7% to A$5.93, and Oil Search 4.2% to A$7.34.
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Materials and resources stocks ended mixed. Among top miners, BHP Billiton lost 0.9% to A$25.36 and Rio Tinto 0.7% at A$54.81. Iron-ore producer Fortescue Metals Group finished up 5.3% to A$2.40, as prices for iron ore continued to rebound.
Gold producers fared particularly well as prices for gold continued to rebound. Evolution Mining rose 12% to A$1.50, Newcrest Mining closed 1.5% higher at A$14.71 and Northern Star climbed 1.4% to A$2.95.
China market soars
The Mainland China's stock market soared after central bank announcement of stimulus measures and reports of reform in the telecommunications sector. Meanwhile, buying momentum also underpinned on possibility of further stimulus measures when Beijing meets later this month to discuss the 13th five-year plan. All 10 SSE sectors added strength to the key index, with telecommunication, energy, material, and industrial stocks leading rally. The Shanghai Composite Index advanced grew 3.3%, or 104.51 points, to close at 3287.66 points. The Shenzhen Composite Index, which tracks stocks on China's second exchange, added 4.18%, or 75.65 points, to 1887.28. The ChiNext Index, which tracks China's NASDAQ-style board of growth enterprises, grew 4.52%, or 100.13 points, to close at 2316.78.
China's central bank announced over the weekend that it would expand a pilot scheme on relending, the latest effort by the government to help support a slowing economy. The scheme, which allows banks to refinance high quality credit assets rated by the central bank, was introduced in Guangdong and Shandong provinces last year. It will be expanded to include nine municipalities and provinces, namely Shanghai, Tianjin, Liaoning, Jiangsu, Hubei, Sichuan, Shaanxi, Beijing and Chongqing. The move is expected to cut borrowing costs and guide more funds into agriculture and small enterprises to boost the real economy.
Shares of telecom linked players gained on signals of reform in the country's telecommunications sector. The state-owned Shanghai Securities Journal on Monday reported that China Reform Holdings Corp. will shell out over 10 billion yuan ($1.58 billion) to buy a 6% stake in China Tower Corp., potentially helping the jointly controlled operation develop electric-vehicle charging stations.
Real estate shares also posted robust gains, boosted by recent data showing in a recovery in property sales. Poly Real Estate rose 2.9% after reporting a 20% rise in contract sales during the Jan-Sept period.
China's foreign direct investment rose more than 9% to 584.74 billion yuan in the first nine months of this year, data from the Ministry of Commerce showed. China's FDI rose 9.2% during the January-August period, compared with a year earlier.
Hong Kong market extends gain
Hong Kong stock market advanced in tandem with the rally in the US equity markets on last Friday and strong showing of the Mainland A-share market today. The benchmark index opened 155 points higher and saw its gains widen to as much as 321 points after the Shanghai market jumped more than 100 points. The Hang Seng Index advanced 272.13 points, or 1.21%, to 22730.93 points. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, soared 131.40 points, or 1.26%, to 10538.19 points. Turnover reduced to HK$87.2 billion from HK$93.5 billion on Friday.
Shares of telecom players soared the most in Hong Kong on reports that China Reform Holdings plans to buy a stake in China Tower Corp valued at more than RMB10 billion. Citi Research said the potential transaction may raise the valuations for China Unicom (00762) jumped 6% to HK$10.36 and China Telecom (00728) rose 4.2% to HK$4. China Mobile (00941) added 2% to HK$93.15.
Shares of brokerages were also higher, with CGS (06881) soaring 10% to HK$6.94, while First Shanghai (00227) jumped 8% to HK$1.28. CC Securities (01375) put on 4% to HK$4.28.
Macau gaming counters were softer due to profit-taking pressure. Sands China (01928) slipped 3% to HK$27.4. Galaxy Ent (00027) fell 3% to HK$24.8
Shares of Glencore were suspended from trading in Hong Kong, pending the release of information on the firm's assets in Australia and Chile. The stock had surged 43% in Hong Kong last week as the firm shuts down operations that mine many of the most actively traded commodities, reducing gluts in everything from coal to copper.
Indian market closes down
IT major and index heavyweight Infosys led losses for key benchmark indices, with the stock sliding after the company cut full year revenue growth guidance in dollar terms. The barometer index, the S&P BSE Sensex, fell 167.35 points or 0.62% at 26,912.16, as per the provisional closing data. The 50-unit CNX Nifty dropped 46.10 points or 0.56% at 8,143.60, as per the provisional closing data. The Sensex and the Nifty reversed direction after both these key benchmark indices struck their highest level in more than 7 weeks at the onset of the trading session.
Shares of IT major Infosys edged lower in choppy trade after the company lowered its full year revenue growth guidance in dollar terms for the year ending 31 March 2016 (FY 2016) at the time of announcement of Q2 September 2015 results. The stock was off 3.93% at Rs 1,122. Infosys now expects its revenue to grow 6.4%-8.4% in dollar terms for FY 2016. At the time of announcing Q1 June 2015 results, Infosys had forecast revenue growth of 7.2%-9.2% in dollar terms for FY 2016. The revenue growth guidance for FY 2016 has been kept unchanged at 10%-12% in constant currency terms.
Bank of Baroda (BoB) tumbled 3.29% at Rs 176.30 after the Central Bureau of Investigation (CBI) began a probe under the Prevention of Corruption Act, 1988 against 59 current account holders of Bank of Baroda and unknown officials of the state-run bank and some private persons. The allegation is that the current account holders of the bank and bank officials conspired to send overseas remittances of foreign exchange worth approximately Rs 6000 crore in illegal and irregular manner in violation of established banking norms under the garb of payments towards suspected non-existent imports. The CBI began investigation into the case after a complaint from Bank of Baroda.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index rose 1.5% to 8573.72. South Korea's KOPSI added 0.1% to 2021.63. New Zealand's NZX50 climbed up 0.9% to 5689.83. Singapore's Straits Times index added 1.1% at 3032.11. Indonesia's Jakarta Composite index grew 0.9% to 4630.71. Malaysia's KLCI fell 0.2% to 1703.71.
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