Asia Pacific share market closed down on Wednesday, 14 January 2015, as a falling oil and commodity prices kept investors in a gloomy mood. Meanwhile, the World Bank's scaled-back growth projections for the global economy added to the cautious sentiment.
Shares in regional markets mostly plunged at the open on tracking losses in the US markets overnight amid decline in commodity prices and as crude oil extended their rout and. Meanwhile, selloff pressure intensified during the day after World Bank lowered outlook for global economic growth, citing a strengthening U.S. economy and plummeting oil prices won't be enough to offset deepening trouble in the eurozone and emerging markets.
Crude oil prices extended their recent selloff after the UAE's oil minister said OPEC would stand firm on output. The light, sweet crude futures for delivery in February declined to $45.81 in recent trade in the Globex electronic session in New York.
Crude's continuing slide coincided with the World Bank's latest flagship Global Economic Prospects report, which trimmed worldwide growth to 2.6% in 2014 and 3.0% in 2015, down 0.2 percentage point and 0.4 percentage points from its June forecasts, respectively. The cut in forecasts came majorly on the back of growing growth concerns in China and Eurozone.
Among Asian bourses
Nikkei falls for a second day as yen climbs
Japanese share market closed down for second consecutive session, as the yen climbing against the greenback, continuous plunge in crude prices, and the World Bank's downward revision of its forecasts for global growth triggered risk aversion selloff. The Nikkei Stock Average declined 291.75 points, or 1.71%, to 16795.96.
Shares of material and resources companies declined the most in Tokyo market, as global prices for copper, aluminium, lead, zinc, nickel, and tin all lost ground overnight. Copper, which is used ubiquitously in construction, fell 2.5% in London. Sumitomo Metal Mining declined 8.1%, while Dowa Holdings lost 4.9%. Steelmakers JFE Holdings and Nippon Steel & Sumitomo Metal Corp. also surrendered 5.3% and 3.7%, respectively.
Meanwhile, manufacturing exporters were generally lower on the dollar's weakness, with Toyota Motor dropping 1.6% and Kyocera down 3.0%.
Kirin Holdings gained 1.5% after JPMorgan raised the company to overweight from neutral, upping its target price to Y1700 from Y1400 to reflect attractive valuations and shareholder return policies.
Household products maker Kao gained 2.3% after Credit Suisse raised its target price to Y5500 from Y5000 on expectations for a compound annual sales growth rate of 10% over the next three years.
Australia stocks hit by plunging copper prices
Australian share market finished the session lower for third consecutive session on the back of selloff pressure across the board, with shares in materials & resources being major losers in response to a fall in the price of copper to its lowest level in five years. The benchmark S&P/ASX 200 Index and the broader All Ordinaries Index both declined by 0.9% to 5353.60 and 5332.20, respectively.
Shares of material and resources companies were worst performers in the Australian market, pressured by soft commodity prices. Resources giant BHP Billiton was down 2.8% to A$27.20, while main rival Rio Tinto slipped 3.3% to A$55.54. Australia's third largest iron ore miner Fortescue Metals Group tanked 8.2% to A$2.34.
Oz Minerals tanked 11.7% to A$3.25 and Sandfire Resources fell 9% to A$4.06. Gold miner Newcrest Mining fell 3.9% to A$12.44 and Evolution Mining shed 7.1% to A$0.85.
Bucking the trend, shares of Santos rallied 2.1% to A$7.36 as the Australian Financial Review said its Chief Executive David Knox was looking at possible asset sales, while Whitehaven Coal added 1.3% to A$1.21 after reporting a drop in quarterly production but forecasting its metallurgical coal as sticking roughly around the previous quarter's price. Barbara surged 3.6% to A$0.14 on the back of its own production report, which included record output at two of the gold miner's key projects. Transurban Group edged 0.1% higher to A$8.83 after the toll-road company posted a 37% rise in toll revenue.
Shares of Harvey Norman, Australia's largest furniture, appliances and home-wares retailer, soared 6.7% to A$3.69 after the company reported a big surge in sales over the Christmas-New Year period and optimistic about the year ahead.
China stocks drop on weak oil and commodity prices
Mainland China share market closed down, as continuous plunge in global metal and crude oil prices eroded investors' confidence. The World Bank's scaled-back growth projections for the global economy also added to the cautious sentiment. The Shanghai Composite declined 0.4%, or 12.86 points, to 3222.44.
Shares of material and energy firms were among the worst performers amid a plunge in global metal and oil prices. Copper plunged to a 5 1/2-year low and New York crude retreated 1.4%. PetroChina Co. fell 2.8%. Jiangxi Copper Co., China's biggest producer of the metal, retreated 3%. Tongling Nonferrous Metals Group Co, the second biggest, tumbled 6.5%, while Yunnan Copper Industry Co. dropped 4.4%. China Coal Energy Co. fell 2.3% while Yanzhou Coal Mining Co. slumped 6%.
Financial stocks were mostly higher on reports the People's Bank of China plans to roll over at least part of a three-month lending facility till October. The 269.5 billion yuan medium-term lending facility was set to expire later this month. Industrial & Commercial Bank of China, the nation's biggest listed lender, gained 1.5%, while Construction Bank added 2.4%. Bank of China rose 3.4%.
Hang Seng ends 0.43% down
Hong Kong share market closed down in narrow trade, as falling oil and commodity prices kept investors in a gloomy mood. The Hang Seng Index ended 103.37 points, or 0.43%, down at 24112.60, off an intra-day high of 24326.70 and low of 24056.22. Turnover increased to HK$86.08 billion from HK$84.85 billion on Tuesday.
Shares of Hong Kong-based real-estate developers declined after territory Chief Executive C Y Leung delivered his 2015 Policy Address, mentioning sale of public rental housing. SHKP (00016) slid 2% to HK$121.2. Wheelock (00020) dipped 2.3% to HK$40.75. Cheung Kong (00001) and Henderson Land (00012) slipped less than 1% to HK$142.4 and HK$53.3. Mainland developers fared better. COLI (00688) rose 2.3% to HK$24.7. CR Land (01109) edged up 0.2% to HK$21.15. Yuexiu Property (00123) gained 1.9% to HK$1.6.
Infrastructure and building counters jumped as the government initiated building spree. NWS Holdings (00659) gained 2.9% to HK$14.28. China State Con (03311) soared 5.6% to HK$11.98. SOCAM Dev (00983) shot up 6.6% to HK$7.46.
Mainland Chinese banks advanced as investors watched closely for the release of China's December credit data, which was expected sometime this week from the central bank. Bank of China added 0.2% to HK$4.41, China Citic Bank Corp. rose 0.7% to HK$5.91, and China Minsheng Banking Corp tacked on 0.2% to HK$10.26.
Sensex ends 79 points lower, Nifty below 8300
Indian stock markets today fell for the second straight session with benchmark Sensex dropping 78.91 points or 0.29% to settle at 27,346.82, its lowest closing level since 8 January 2015. The CNX Nifty declined 21.85 points or 0.26% to settle at 8,277.55.
Cement shares edged higher after the Ministry of Mines after trading hours yesterday, 13 January 2015, said that the government has promulgated the Mines and Minerals (Development and Regulation) (Amendment) Ordinance, 2015 on 12 January 2015. Metal and mining stocks declined as metal prices fell in global markets. Yes Bank gained in volatile trade after reporting strong Q3 results. ITC shares tanked on worries related to proposed ban on sale of loose cigarettes.
On macro front, data released during trading hours today, 14 January 2015, showed that inflation based on the wholesale price index (WPI) stood at 0.11% in December 2014, as compared to zero in November 2014. Build up inflation rate in the financial year so was a negative 0.28%, compared to a build-up rate of 5.58% in the corresponding period of the previous year. Meanwhile, WPI for October 2014 was revised downwards to 1.66%, from 1.77% reported earlier.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index fell 0.56% to 9180.23. South Korea KOSPI was down 0.2% to 1913.66. New Zealand's NZX50 rose 0.2% at 5648.62. Singapore's Straits Times index fell 0.45% at 3326.16. Indonesia's Jakarta Composite index dropped 1.05% to 5159.67. Malaysia's KLCI fell 0.4% to 1742.01.
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