Asia Pacific share market declined on Monday, as investors steer away from risk assets after China's manufacturing data pointed to slowing economy activity in the world second largest economy.
Sentiment turned bearish across the region after gauge of activity in China's manufacturing sector slipped in October for the third straight month, dampening hope for a quick recovery in the world's second-largest economy.
On Monday, a private gauge of China's manufacturing activity, the Caixin China manufacturing purchasing managers index, rose to 48.3 in October, marking the eighth-straight month of contraction. The reading, which tends to capture more private enterprises than the official reading, was at 47.2 in September. On Sunday, an official gauge of Chinese factory activity contracted unexpectedly in October. China's manufacturing purchasing managers index remained unchanged at 49.8 in October from a month ago, the third-straight month the reading came in below 50. A reading above 50 indicates expansion in activity, while one below that level signals contraction.
Among Asian bourses
ASX200 index slides below 5200 level
The Australian share market suffered heavy losses, extending last week losing momentum, as risk aversion selloff triggered after China manufacturing PMI intensified doubt about economic growth in the world second largest economy. Investors were also nervous on caution ahead of Tuesday's Reserve Bank of rate decision. The benchmark S&P/ASX 200 index declined 73.60 points, or 1.4%, to 5165.80 points, while the broader All Ordinaries index sank 67.30 points, or 1.27%, to 5221.30 points.
Shares of financial sector was hit hard, with Westpac Banking Corp leading retreat, down 2.5% to A$30.61 after the nation's third largest-lender by assets posted a 3% rise in annual profit, but highlighted a fragile outlook with modest credit growth, intense competition and ongoing regulatory uncertainty. Commonwealth Bank of Australia sank 2.1% to A$75.10 and ANZ Bank declined 2.3% to A$26.58, while National Australia Bank dropped 1.7% to A$29.62. Investment bank Macquarie Group widened losses to 4.4% on news that it was planning a share purchase plan.
Gold miner stocks were also dented after bullion prices dropped to four-week lows in Asian trade. Evolution Mining and were among the biggest losers, down more than 4% each, while Newcrest Mining fell 2.4% to A$12.01,meanwhile Kingsgate Consolidated slipped 4.6% to A$0.63.
Materials and resources turned mixed amid ongoing weakness in metal prices and concerns about China after weak mainland's PMI data. BHP Billiton receded 1% to A$22.80 but Rio Tinto erased losses to nudge up 0.2% to A$50.76. Fortescue Metals rallied 1.4% to A$2.12. Santos surged 1.9% to A$5.95 after Malaysia's Sona Petroleum agreed to buy its oil field for $50 million.
Nikkei slides below 19000 mark
The Japanese share market tumbled from two month peak, as investors steer away from risk assets after China's manufacturing data pointed to slowing economy activity in the world second largest economy. All 33 TSE first-section sector sub-indexes ended down, with Iron & Steel, Marine Transportation, Nonferrous Metals, Land Transportation, Electric Power & Gas, Real Estate, and Banks issues being major losers. The Nikkei Stock Average stumbled 399.86 points, or 2.1%, to end at 18683.24 points. The broader Topix index has lost 2%, or 31.23 points, to 1526.97 at the close. Japanese markets are closed on Tuesday for a holiday.
Exporters were broadly down in Tokyo market today, with companies having heavy exposure to the mainland were hardest hit amid fresh China-related concerns. Steel producers Nippon Steel & Sumitomo Metal Corp declined 5.5% to 2335 yen and JFE Holdings Inc tumbled 5.6% to 1809 yen, while Construction equipment makers Komatsu dropped 1.8% to 1967 yen and Hitachi Construction Machinery Co declined 1.3% to 1857 yen.
Banking stocks were also down, with Mitsubishi UFJ Financial Group down 3.2% to 765 yen and Sumitomo Mitsui Financial Group down 3% to 4713 yen.
Kobe Steel slumped 6.5% to 144 yen after on Friday again downgrading its profit forecasts for the year ending next March, on the heels of a downward revision on Sept. 28.
Kawasaki Kisen Kaisha plunged 8.8% to 249 yen after on Friday posting a 45% year-on-year decline in net profit in the April-September period and downgrading its annual net profit forecast.
Shiseido Co dropped 5.3% to 2739 yen after the cosmetics maker reported Friday an 84% fall in net profit for the first half of the business year.
Japan's factory report showed manufacturing expanded in October at the fastest pace in a year. The Nikkei Japan Manufacturing PMI index rose to 52.4 from 51 in September, marking six months of expansion and the highest reading since October 2014. A reading above 50 indicates economic expansion, while a reading below 50 points toward contraction.
China stocks fall 1.7%
Headline equities of the Mainland China market ended down, as signs of deterioration in China's economy after worse than expected as manufacturing data keeping market participants away from riskier assets. Risk sentiments dented further after authorities detained a top-performing hedge-fund manager in widening probes into market manipulation and insider trading. The Shanghai Composite Index dropped 1.7%, or 57.48 points, to close at 3325.08 points. The Shenzhen Composite Index, which tracks stocks on China's second exchange, declined 1.33%, or 26.89 points, to close at 1987.97. The ChiNext Index, which tracks China's NASDAQ-style board of growth enterprises, was down 1.87%, or 46.24 points, to close at 2432.048.
Shares of energy, material and telecom companies had worst performances among 10 industry groups today. Yanzhou Coal Mining Co. slid 2.5%, while China Shenhua Energy Co., the biggest producer of the fuel, lost 2.1%. Aluminum Corp. of China slid 3.1%. Tongling Nonferrous Metals Group Co., the nation's second-largest copper smelter, plunged 6.4%.
Shares of lenders which were seen as a proxy on China's economic growth were among the laggards on Monday. Industrial and Commercial Bank of China (ICBC), the world's largest bank by assets, widened losses to 1.1%. Bank of China and Bank of Communications lost 0.8 and 1.7% respectively.
Hong Kong market falls 1.2%
Hong Kong stock market ended deeply below the neutral line, as investors opted to lock in gains following both Chinese manufacturing data and U.S. consumer spending figures coming in below median expectations. The majority of categories on the main section retreated, led by finance, realty, and industrial shares. The benchmark Hang Seng Index declined 270 points, or 1.19%, to 22370.04 points. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, fell 156.25 points, or 1.5%, to 10240.33 points. Turnover reduced slightly to HK$67.4 billion from HK$69 billion on Friday.
Mainland lenders saw selling pressure as they reported lackluster earnings. Bankcomm (03328) slipped 2% to HK$5.65. HSBC (00005) dipped 1% to HK$60.3. ICBC (01398) also fell 2% to HK$4.84 despite bullish comments from investment houses. ABC (01288) sank 3% to HK$3.1 on talks that its governor Zhang Yun was under investigation.
CK Hutchison (00001) declined 3% to HK$103.7 on talks that its acquisition of UK's O2 mobile network operator was investigated by the European Commission.
Hong Kong-listed casino operators turned negative, with Galaxy Entertainment and down 1.1% to HK$26.35 Sands China surrendered 0.9% to HK$27.90, after data over the weekend that showed gambling revenue in Macau fell 28.4% in October from the same period a year earlier, marking the 17th consecutive month of decline.
Sensex, Nifty hit 4-1/2-week closing low
Losses for metal and pharma sector stocks and index heavyweights HDFC and L&T outweighed gains for banking stocks and index heavy heavyweight Reliance Industries (RIL) to push key benchmark indices lower. The barometer index, the S&P BSE Sensex, lost 97.68 points or 0.37% to settle at 26,559.15. The Nifty lost 15 points or 0.19% to settle at 8,050.80.
Losses for metal and pharma sector stocks and index heavyweights HDFC and L&T outweighed gains for banking stocks and index heavy heavyweight Reliance Industries (RIL) to push key benchmark indices lower. The barometer index, the S&P BSE Sensex, lost 97.68 points or 0.37% to settle at 26,559.15. The losses for the Sensex were higher in percentage terms than those for the 50-unit CNX Nifty index. The Nifty lost 15 points or 0.19% to settle at 8,050.80.
L&T extended post-result slide after the company's management in a post earnings conference call reduced the company's order inflow and revenue guidance for the full year. Metal and mining stocks declined as China's manufacturing data pointed to slowing activity. Coffee Day Enterprises (CDEL), the parent company of the Coffee Day Group which houses the coffee selling restaurants CafCoffee Day, made a weak debut on the bourses.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index rose 0.7% to 8614.77. South Korea's KOPSI rose 0.3% to 2035.24. Singapore's Straits Times index slipped 0.8% at 2974.41. Indonesia's Jakarta Composite index rose 0.2% to 4464.96. Malaysia's KLCI fell 0.1% to 1664. New Zealand's NZX50 sank 0.04% to 5983.84.
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