Asia Pacific share market closed mixed on Monday, 08 December 2014, as better-than-expected jump in US jobs data offset by disappointing Chinese and Japanese economic data. Meanwhile, a warning about the European currency bloc's economic prospects also weighed on sentiments. The MSCI Asia Pacific Index fell 0.1% to 139.86.
Japan's economy shrank more than initially reported in the third quarter on declines in business investment, data showed on Monday. The world's third-biggest economy shrank an annualized 1.9% in the July-September quarter compared with the initial estimate of a 1.6% contraction. In the April-June quarter, the economy dived 7.3%.
China's trade growth came in much lower than expected, with export growth slowed sharply to 4.7% in November from 11.6% in October, while imports declined by 6.7% year over year in November from growth of 4.6% in October. The trade figures resulted in a record-high monthly trade surplus of $54.5 billion, up from $45.4 billion in October.
The disappointing Chinese and Japanese data contrasted sharply with Friday's US non-farm payrolls that showed employment in November surged by 321,000, above the market estimates and the best performance in almost three years, raising hopes the Federal Reserve will raise interest rates in the near future.
Among Asian bourses
Aussie stocks climb
Australian share market closed higher on Monday, 08 December 2014, with strong gains for airlines and the major banks offsetting losses by the mining and energy sectors. The benchmark S&P/ASX 200 index advanced 37.40 points, or 0.7%, to 5372.70 and the broader All Ordinaries index grew 35.30 points, or 0.66%, to 5348.90.
Financial shares were up, with big four banks all prospered after Sunday's release of a long-awaited government report, indicating that the big lenders may need more capital but containing little in the way of bad surprises. Commonwealth Bank of Australia grew 0.9% to A$82.39, Westpac Banking Corp 1% to A$33.35, ANZ Banking Group 0.9% to A$32.40 and National Australia Bank 1.8% to A$32.97.
Airline carriers stocks advanced, led by Qantas, surging 13.8% to A$2.39 after the airline advised the market it expected to post an underlying profit of at least A$300 million for the first half of 2014-15, a turnaround from the A$2.8 billion statutory loss last financial year. Qantas rival Virgin Australia Holdings also followed higher with a 2.4% gain to A$0.43.
The major miners closed down after gains for the U.S. dollar on better-than-expected employment data out Friday hit the commodity markets. The decline in resources stocks also triggered after disappointed Chinese trade data, with both exports and imports growing at a slower rate than expected. Mining giant BHP Billiton fell 1.1% to A$30.10, while Rio Tinto edged 0.02% down at A$57.13. Iron ore miner Fortescue Metals was 0.8% weaker at A$2.66.
Coca-Cola Amatil was 16 cents lower at A$9.10 after announcing it will axe 260 jobs as it undertakes a $100 million cost cutting campaign.
Nikkei rises at new seven-year high
Japanese stock market closed marginal higher in lacklustre trade, as record highs of Wall Street on Friday and yen depreciation to 121-level against the greenback mostly offset by downward revision to Japan's quarterly economic performance. The benchmark Nikkei Stock Average advanced 15.19 points, or 0.08%, to 17935.64, a highest level since July 2007.
The yen depreciation to 121-level against the greenback continued supporting the gain. At the end of trading, the yen slid to 121.43 per dollar, well up from Friday's 120.01 yen mark. A higher dollar is good for exporters, who can then afford to cut prices on goods they sell overseas and earn more yen with the repatriated profits.
Exporter shares extended gain, with Toyota Motor adding 1.5%, Tokyo Electron gaining 2.9%, and Bridgestone up 1.9%.
Honda Motor slipped 0.2% after saying it will have to recall an extra three million vehicles in the U.S. over explosive air bags made by safety supplier Takata when it expands certain regional recalls. Takata's stock fell another 1.6%, putting its stock losses related to airbag troubles at 15% over the last month.
Advertising giant Dentsu surged 4.7% after Merrill Lynch Securities Japan subsequently raised its target price to Y5500 from Y5000.
Panasonic fell 2.0% after a JPMorgan downgrade to Neutral from Overweight, citing limited share price upside, the likelihood of slowing auto battery business growth, and a fading restructuring premium in its share price.
Machine tool manufacturer DMG Mori Seiki posted a 6.1% rise after Deutsche Bank initiated coverage at Buy with a Y1750 price target, citing as catalysts a weaker yen and strong domestic capex in the high single digits.
Shanghai Composite tops 3K marks
Mainland China share market closed volatile session at new 43-month high, on optimism shares will extend their world-beating rally. Investors shrugged off warnings about the risk of a potential sell-off from the government. The benchmark Shanghai Composite Index ended up 2.8% at 3020.26, its highest close since Apr. 21, 2011 when it closed at 3026.67. The Shenzhen Composite Index rose 0.8% to 1466.65. Combined daily turnover of China's Shanghai and Shenzhen stock exchanges fell slightly to 960.8 billion yuan from a record high of 1.051 trillion yuan on Friday.
The state-run Xinhua News Agency on Sunday published a commentary piece, warning against the potential risk of a market correction following recent steep rises while calling for a more sustainable bull market. The warning by the official propaganda was perceived as a trigger of an early-session pullback on Monday, which was followed by a strong rally that sent the market to its highest level in over 43 months.
Shares of financial companies climbed the most in SSE sectoral peers, with brokerages being top gainers as investors continued to play the theme of a significant growth in earnings thanks to extremely active trading. 11 of 19 listed brokerages hit their 10% daily upside limit, including the nation's biggest brokerage by total assets, Citic Securities, and the second-largest, Haitong Securities.
Military equipment manufacturers extended their gains after media reports that Chinese President Xi Jinping, also chairman of the Central Military Commission, urged faster development of the nation's military equipment systems. China Shipbuilding Industry and Avic Aircraft both closed at 10% daily upper limit.
Hang Seng adds to winning streak
Hong Kong share market closed higher on Monday, 08 December 2014, as record high finish of Wall Street on Friday and gain in mainland A-share market boosted up risk sentiments. But a portion of the advance was handed back after disappointing Chinese trade data. The Hang Seng Index ended higher by 45.03 points, or 0.19%, to 24047.67, off an intra-day high of 24189.59 and low of 24012.15. Turnover reduced to HK$122.98 billion from HK$147.8 billion on Friday.
As for the Shanghai-HK stock connect flow, the southbound quota balance was RMB9.975 billion, while the northbound quota balance was RMB11.323 billion, accounting for 95% and 87% of the daily allowed quotas respectively.
Chinese banks and insurers followed the rally of A-share market. BOC (03988) soared 4.6% to HK$4.32. It was the top blue-chip winner today. CCB (00939) jumped 3.9% to HK$6.41. ICBC (01398) shot up 3.7% to HK$6.35 and HK$5.68. Ping An (02318) bounced 4.3% to HK$76.15.
Shares of casino companies continued its weakness Chief Executive of Macau yesterday estimated the average monthly GGR of gaming industry to fall to MOP27.5bn in 2015. Galaxy Ent (00027) slipped 2.6% to HK$46.8. Sands China (01928) dipped 3% to HK$39.85. Wynn Macau (01128) slid 4.4% to HK$21.9. MGM China (02282) fell 2.7% to HK$21.45.
Sensex, Nifty hit 2-1/2-week closing low
Indian stocks dropped on first trading day of the week amid concerns strong US job growth may prompt the US Federal Reserve to speed up interest rate hikes in the world's biggest economy. The barometer index, the S&P BSE Sensex, and the 50-unit CNX Nifty, both, hit 2-1/2 week closing low. The market breadth indicating the overall health of the market was weak. The Sensex lost 338.70 points or 1.19% to settle at 28,119.40. With a 1.22% decline, the fall in the BSE Mid-Cap index was higher than the Sensex's slide in percentage terms.
Shares of power generation companies declined. Index heavyweight and cigarette major ITC extended its recent gains triggered by reports the government may put on hold its plan to ban sales of single cigarettes. Infosys declined after company's founders sold a total 3.26 crore shares of the company in bulk deals on NSE. Thermax advanced after securing a repeat order. Auto stocks declined.
Bank stocks dropped. Bank of Baroda reversed direction after scaling a record high. Metal and mining stocks edged lower after disappointing China trade data for November. Steel Authority of India edged lower amid volatility as offer for sale (OFS) for government's 5% stake-sale in the company was successfully concluded during the previous trading session on Friday, 5 December 2014. Cement stocks were mixed.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index fell 0.2% to 9187.29. South Korea KOSPI was down 0.4% to 1978.95. New Zealand's NZX50 was edge .1% up at 5529. Singapore's Straits Times index sank 0.5% at 3308.86. Indonesia's Jakarta Composite index fell 0.85% to 5144. Malaysia's KLCI dropped 0.5% to 1740.84.
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