Investment rationale hit across the region amid worries about credit restrictions in the China's huge property sector will hurt the demand outlook for metals and curb growth in the world's second-largest economy after a Chinese state-owned newspaper said some Chinese banks curbed loans to property developers.
Industrial Bank Co. and other unidentified banks have curbed lending to the property sector and related industries such as steel and cement, Shanghai Securities News reported as China said new home priceass rose in 69 of 70 cities last month from a year before. But the growth in new-home prices in China's first-tier cities slowed in January, National Bureau of Statistics data today showed. New housing prices in China rose 9.6% in January from a year earlier, but decelerated month-on-month for the first time in a year.
Market players tried to lock in some profit and they are waiting for U.S. economic indicators, which appear unpredictable due to the impact of the recent winter storm. U.S. February consumer confidence figures are due to be released on Tuesday, followed by data showing durable goods orders and initial jobless claims on Thursday. On Friday, the final estimate for fourth-quarter U.S. gross domestic product is out.
Among Asian bourses, Japan's stock market finished the session with red ink, as late hour profit taking after strong gains in Friday's session. Meanwhile, weaker dollar and falls in major Asian markets applied further pressure on the local index in the afternoon. The benchmark Nikkei-225 index dropped 27.90 points, or 0.19%, to finish the session at 14837.68, while the broader Topix index of all first-section shares sank 3.24 points, or 0.27%, to 1219.07.
Insurers shares were the worst performers in the Nikkei index on reports three major nonlife insurers are bracing for some 60 billion yen in claims as February's record snowfall wrought havoc in north-eastern and central Japan. The figure compelled some traders to speculate that large, unforeseen pay-outs may result in earnings forecast cuts. NKSJ Holdings lost 2.4%, Tokio Marine Holdings fell 1.9% and MS&AD fell 3.3%.
Financials were mostly lower, with Mizuho Financial Group Inc. down 0.93%, and Sumitomo Mitsui Financial Group Inc. down 1.41%, Nomura Holdings Inc. down 1.40% and Daiwa Securities Group Inc. down 1.88% a piece.
In Australia, Australian stock market finished tad higher, as upbeat tone of domestic company reporting season mostly offset by weak lead from the United States Friday and concerns about liquidity in China. The benchmark S&P/ASX 200 Index eked out a gain of 1.5 points, or 0.03%, to 5440.2, to close higher for the seventh straight session. The broader All Ordinaries Index added 0.07 point to 5450.10.
Monadelphouss (MND) shares rose 6.5% to A$17.66 on news of a A$680 million construction contract associated with the Ichthys gas project in Darwin. MND will install piping, mechanical and structural steel for the utility and offsite area commencing immediately with completion date of mid-2016. The project involves the piping of LNG from the Browse Basin off the Kimberley coast to Darwin for processing and export.
Shares of Boart Longyear (BLY) shares declined 15% to A$0.36 after the company posted a net loss of $US620 million in 2013, as compared profit of $US68 million profit in 2012. BLY didnt provide earnings guidance for 2014, citing market uncertainty.
Shares of Spark Infrastructure rose 1.7% to A$1.79 after the power grid owner announced plans to increase its full year dividend despite a falling annual profit.
Shares of Steadfast closed unchanged at A$1.65 after the company reported an 8% jump in interim net profits. McAleese fell 1.5% to 67 cents after confirming a first-half loss of A$38 million as flagged last week.
Transfield Services was up 24.5% to 99 cents on the news it had won a A$1.2 billion contract to build new asylum seeker offshore processing centres on Naru and Manus Island.
Origin Energy added 0.1% to A$14.56 after unveiling a A$252 million deal with Senex Energy to get into the unconventional gas market. Shares in Senex gained 2.6% to 78.5 cents.
Caltex Australia rose 2.2% to A$20.94 despite showing a 27.5% fall in full year net profit. The company said it was on track to turn its struggling refinery business into an import terminal by the end of 2014.
In New Zealand, NZ stock market climbed despite a lower show in most regional peers. Domestic stocks rose, led by Sky Network Television, after the nation's pay-TV operator posted earnings that beat estimates. Telecom rebounded from a selloff on Friday when it posted a modest gain in earnings and announced a rebranding strategy. By the provisional closing, the NZX 50 Index rose 42.005 points, or about 0.9%, to 4969.645. Within the index 21 stocks rose, 19 fell and 10 were unchanged.
Among NZ blue chips, Telecom rose 3.2% to NZ$2.45 after the nation's biggest telecommunications provider posted a 2.5% gain in first half earnings, and announced plans to rebrand as Spark and develop an internet television service to rival Sky TV. Fletcher Building, New Zealand's biggest listed company, rose 1.2% to a three month high NZ$9.87.
In China, equities of the Mainland China market stumbled, dragging the benchmark Shanghai Composite Index down by 1.75% to finish at 2076.69, as risk aversion selloff across the board on intensifying liquidity crunch woes, with realty players led the downfall on speculation about further tightening in the industry.
The concerns over the liquidity crunch resurfaced after the People's Bank of China stepped up draining via repo transactions, removing a net 108 billion yuan out of the banking system last week, on the top of 450 billion yuan drain prior to that.
Shares of Mainland realty companies stumbled after unconfirmed media reports over the weekend said several banks were halting their loans to the real estate sector. The poor performance of the property sector also followed government data released on Monday that showed home prices dropped month on month in more Chinese cities in January, signaling a gradually cooling property sector. China Enterprise Co fell by almost 10%. Poly Real Estate Group dropped 8.38% to 6.78 yuan, China Vanke fell 6.6% to 6.69 yuan and Gemdale Corp. slid 7.5% to 5.92 yuan.
Shares of defensive Health-care companies rose. Andon Health Co. was up at the daily 10% limit to 25.52 yuan. Guangdong Biolight Meditech Co. was also up the daily limit finishing at 27.50 yuan.
In Hong Kong, stocks of the Hong Kong market closed sharply lower, weighing the benchmark Hang Seng index lower by 0.8% to finish at 22388.56, with realty stocks lead losses on reports of potential tightening of real estate loans to developers and the price cuts of Hangzhou property projects.
Among the HK 50 blue chips, 42 fell and six rose, with two stocks remaining unchanged. Among blue chips, shares in HSBC Holdings sank 0.53% ahead of its earnings later in the day. Cathay Pacific Airways dropped 2.55% as it named a new chairman and chief executive. Belle International Holdings retreated 5.91%. Sands China shares rose 0.76% following its announcement that fourth-quarter table-market share rose to 26% from 22%.
Real-estate developers, especially those with strong mainland exposure, and property-related stocks among the decliners as the Hang Seng Index, after unconfirmed media reports over the weekend said several banks were halting their loans to the real estate sector. The poor performance of the property sector also followed government data released on Monday that showed home prices dropped month on month in more Chinese cities in January, signaling a gradually cooling property sector. China Overseas Land & Investment sank 3.57% and China Resources Land lost 5.74%. Agile Property Holdings dropped 5.23% and New World Development Co. sank 1.73%. Among construction-material stocks, Anhui Conch Cement Co. dropped 4.85% and BBMG Corp fell 4.83%.
In India, Indian equity market closed slight higher on the first trading session of the week, with the market sentiment boosted by data showing that foreign funds remained buyers of Indian stocks on Friday, 21 February 2014. The S&P BSE Sensex garnered 110.69 points or 0.53% to settle at 20,811.44, its highest closing level since 24 January 2014. The CNX Nifty garnered 30.65 points or 0.5% to settle at 6,186.10, its highest closing level since 24 January 2014.
Foreign institutional investors (FIIs) bought Indian shares worth a net Rs 603.41 crore on Friday, 21 February 2014, as per provisional data from the stock exchanges.
Shares of India's largest power generation firm by capacity NTPC tumbled on huge volume after the Central Electricity Regulatory Commission in its latest order directed power utilities to charge production incentives based on actual offtake, instead of on their readiness to produce power at above 85% capacity utilization. The stock plunged 11.31% at Rs 117.20. The scrip hit 52-week low of Rs 116.60 in intraday trade. On BSE, 46.55 lakh shares were traded in the counter, compared with an average volume of 5.08 lakh shares in the past one quarter.
Tata Power surged after the company said that it has got relief from the Central Electricity Regulatory Commission (CERC) that has asked electricity procurers to pay Rs 329.45 crore as compensatory tariff for its Mundra Ultra Mega Power Project (UMPP) to partly offset escalation in the price of imported coal. The stock jumped 5.02% to Rs 82.65. The stock hit a high of Rs 84.50 and low of Rs 81.60. CERC has asked Gujarat, Rajasthan, Punjab, Haryana and Maharashtra Electricity boards to pay this extra amount for the period 1 April 2012 to 31 March 2013, Tata Power said during trading hours today, 24 February 2014. Tata Power further said that a compensatory tariff of Rs 0.524 per kWh has been granted for the project from 1 April 2013, as per CERC order. This order is in continuation of CERC's previous order of April 2013 and the high level committee's recommendations of August 2013.
Cadila Healthcare rose 4.69% to Rs 995.10 after striking a record high of Rs 1,009 in intraday trade. The company announced after market hours that it has received the final approval from the USFDA to market Clonidine Hcl Injection 0.1 and 0.5 mg/ml, 10 ml in the United States. Clonidine hydrochloride injection is a centrally acting analgesic solution for use in continuous epidural infusion devices which is indicated in combination with opiates for the treatment of severe pain in cancer patients that is not adequately relieved by opioid analgesics alone.
Elsewhere in the Asia Pacific region, Taiwan's Taiex index fell 0.48%. South Korea's KOSPI index lost 045%. Indonesia's Jakarta Composite was down 0.5%. %. Malaysia's KLSE Composite fell 0.11%. Singapore's Straits Times index rose 0.19.
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