Headline equities of the Asia Pacific market ended in mostly in negative territory on the final trading day of the week, Friday, 11 December 2015, due to concerns about receding global growth amid continued slide in crude oil prices, and on caution ahead of another series of Chinese economic data due on Saturday. But, losses were marginal as gains made overnight on Wall Street spurred investors into buying back issues oversold recently.
The fall in oil price is a result of worries over further supply growth as OPEC data showed productions rose to the highest level since April 2012, at 31.7m barrels per day. Meanwhile, there is continuous worry over China's slowdown that could lower the demand for commodities.
Market participants were cautious ahead of a batch of Chinese monthly economic data expected on Saturday, including retail sales, fixed asset investment and industrial production. Further out, a report on foreign direct investment in China is due on Wednesday. The latest China's figures will provide an update on the world's second biggest economy, which is struggling with a stubborn downturn.
Most investors are laying low ahead of the all-important FOMC meeting next Wednesday and Thursday. At the Federal Reserve meeting next week, policymakers are widely expected to increase interest rates for the first time in nine years, but traders will pay close attention to the wording of the statement. The trouble with this recent volatility is it makes it harder to work out sentiment surrounding a possible rate hike. So far, recent growth and inflation data are not supporting the case of a faster pace of tightening. And there is little chance for Fed to sound hawkish with next week's FOMC statement.
Among Asian bourses
Australia stocks ends at one-month low
The Australian equity market declined one-month low, hit by risk aversion selloff for four consecutive sessions, amid concerns about receding global growth and continued slide in crude oil prices. Seven out of ten sectors closed lower. The declines were led by shares of industrial, telecom, material, and energy issues. However, gains in realty, tech, and utilities stocks capped losses. At the close, the benchmark S&P/ASX 200 index dropped 8.20 points, or 0.16%, to finish at 5029.50 points, a lowest level since November 16, 2015, when it closed at 5003.80. The ASX 200 shed 2.3% for the week.
Shares of major banks were flat but just above water. Australia & New Zealand Banking Group rose 0.1% to A$26.22, National Australia Bank 0.6% to A$28.60, and Commonwealth Bank of Australia 0.1% to A$78.95. Westpac Banking Corp rose 0.2% to A$31.47, on reports that lender expects a modest lift in Australia's real rate of growth next year to around 2.75% in its annual meeting.
Shares of materials and resources companies were down. Global miner BHP Billiton declined 1.6% to A$17.20, with investors worried about commodity prices and the fallout from the fatal mine disaster in Brazil. Four weeks ago it was at A$24. Arrium ended 7.3% down at A$0.064 as iron ore prices remained near a decade low. BC Iron shares tanked 25% after the miner temporarily suspended production in its Nullagine joint venture due to negative market conditions.
Nikkei rebounds from five-week low
The Japanese share market rebounded strongly from five weeks low, as bottom fishing on recently battered stocks underpinned after positive finish of the Wall Street overnight and depreciation of yen against the greenback. Total 27 out of 33 TSE industry groups ascent, with the day's notable gainers comprised Pharmaceutical, Iron & Steel, Electric Appliances, Transportation Equipment, Air Transportation, and Machinery issues. The 225-issue Nikkei Stock Average rebounded 183.93 points, or 0.97%, to 19230.48. The Topix index of all Tokyo Stock Exchange First Section issues grew 9.16 points, or 0.59%, to 1549.51.
Shares of exporters' were benefited by yen depreciation against greenback. The greenback rose to 122.08 yen in Asian trading from 121.62 yen on Thursday in New York. A weaker yen boosts the profitability and competitiveness of Japanese firms doing business abroad. Toyota Motor Corp advanced 1.1% and Sony Corp gained 1.2%. Panasonic Corp added 0.3%, Nissan Motor Co 1.4% and Mazda Motor Corp. 2%. Subaru automaker Fuji Heavy Industries, which relies on North America for 60% of sales, gained 1.2%. Uniqlo-operator Fast Retailing, a market heavyweight, was up 1.1%.
Shares of energy explorers were up on bargain hunting following heavy slump in recent sessions. Energy explorer Inpex Corp advanced 0.4% while oil refiner JX Holdings Inc. grew 0.2%. JGC Corp., which provides services to energy firms, added 1.2%.
Japanese train stocks traded rose on the back of India's New Delhi government approval of $14.7 billion Japanese proposal to build India's first bullet train line. Shares in Kawasaki Heavy Industries ended up 0.22%, Hitachi Transport added 0.35% and Nippon Sharyo gained of 0.33%.
China stocks hammer on news of Billionaire Guo Guangchang missing
The Mainland China stock market finished lower, as risk sentiments subdued ahead of another series of economic data due on Saturday, including retail sales, industrial production, and fixed asset investment on Saturday. Also weighing on the market mood were media reports that Guo Guangchang, chairman and founder of Chinese conglomerate Fosun missing, raising fears that Guo had become the latest victim in China's deepening anti-corruption probes. Total 8 out of 10 industry categories on the main section lost ground, with decliners being led by consumer staples, information technology, industrials, utilities, and healthcare issues. The Shanghai Composite Index declined 0.61%, or 20.91 points, to close at 3434.58. The Shenzhen Composite Index, which tracks stocks on China's second exchange, dropped 0.72%, or 16.01 points, to close at 2195.86. The ChiNext Index, which tracks China's NASDAQ-style board of growth enterprises, rose 1.03%, or 27.59 points, to close at 2695.51.
Chinese investor sentiment was hit by a news report that Guo Guangchang, the billionaire tycoon chairman of one of the country's biggest conglomerates, Fosun International, has gone missing. He's the latest senior executive from a Chinese company to disappear amid a sweeping anti-corruption campaign led by President Xi Jinping.
Shares of Fosun and its pharmaceutical unit were suspended after reports that it's 48-year-old Guo Guangchang, chairman of Fosun International has gone missing. He is known as "China's Warren Buffet." In August, Guo granted favors to an executive of a Chinese state-owned company 12 years ago in exchange for unspecified benefits. Shares in Fosun International and Fosun Pharmaceutical were on a trading halt. Five other listed companies under the Fosun Group also suspended trade. Fosun Pharmaceutical's April 2017 bond was down around 1.8%. Some Fosun-invested companies declined. Shanghai Bailian Group Co. fell 1.1%, CNFC Overseas Fishery Co. slid 2% and Zhongshan Public Utilities Group Co. dropped 4.3%.
Hong Kong markets tumbles to ten-week low
The Hong Kong stock market ended at lowest level in more than ten weeks, due to risk aversion selloff for seven consecutive sessions, amid reports that Guo Guangchang, the billionaire tycoon chairman of one of the China's biggest conglomerates, Fosun International, has gone missing. Sentiments also hit by caution ahead of a fresh batch of Chinese monthly economic data expected on Saturday. The benchmark Hang Seng Index was down 240.56 points, or 1.1%, to 21464.05 points, a lowest level since September 30, 2015, when the benchmark's closed at 20846.30 points. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, declined 142.49 points, or 1.51%, to 9308 points. Turnover marginally reduced to HK$68.39 billion from HK$68.90 billion on Thursday.
Shares of Belle (01880) plunged 7.4% to HK$6.15 after it reported 3Q footwear business registered same store sales decline of 10.4%, while the sportswear and apparel business saw same store sales growth of 6%.
Want Want (00151) put on 0.7% to HK$5.70, on reports that it plans to make inroads into yoghurt and infant formula markets.
China Jiuhao Health (00419) swang wildly after it placed shares to Jack Ma's fund, Huayi Brothers and Tencent (00700) at huge discount. It soared 28% earlier and then plunged 21.8% at HK$1.04. Tencent softened 2.2% to HK$147.10.
Glencore shares rose 11.5% to HK$10.54, following 7% gains on London market overnight, after the Swiss miner said it will further cut its debt and gave an upbeat earnings forecast. Glencore shares have fallen over 70% since the beginning of this year.
Sensex extends losses
Indian stock market extended losses and were trading near day's low around late afternoon, due to profit-booking by participants ahead of IIP data to be released later in the day and amid weak global cues. Among BSE sectoral indices, realty index fell the most, followed by banking, capital goods and infrastructure. At 13.40 IST, the 30-share BSE index Sensex was down 0.8% to 25044 and the 50-share NSE index Nifty was down 0.9% to 7611.
Shares of SpiceJet were down after the company has allegedly defaulted on payments towards the Airports Authority of India (AAI).
Shilpa Medicare surged after RBI notified that foreign investors can now invest up to 30% of the paid-up capital of the company. RBI notified yesterday, 10 December 2015, that foreign institutional investors (FIIs)/registered foreign portfolios investors (RFPIs) can now invest up to 30% of the paid up capital of Shilpa Medicare under the Portfolio Investment Scheme (PIS). Earlier, the investment limit was up to 24% of the paid up capital of the company. FIIs held 15.06% stake in Shilpa Medicare as per the shareholding pattern as on 30 September 2015.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index fell 1.2% to 8115.89. South Korea's KOPSI sank 0.2% to 1948.62. Malaysia's KLCI slipped 0.1% to 1646.45. Singapore's Straits Times index lost 0.3% at 2839. Indonesia's Jakarta Composite index shed 1.1% to 4415.91. New Zealand's NZX50 rose 0.5% to 6069.94.
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