Asia Pacific Market: Stocks end mixed

Asia Pacific share market closed mixed after erasing early gains on Monday, 09 January 2017, as investor caution grew after robust U.S. wage growth data strengthened the case for more U.S. interest rate rises.

Friday's closely-watched U.S. employment report showed that fewer jobs were created last month than forecast, although a rebound in wages pointed to economic strength and set the stage for more Fed hikes later in the year.

The focus of this week will be a raft of Chinese economic data, including December figures for consumer and producer prices on Tuesday and trade statistics on Friday, and a closely watched general news conference by Trump on Wednesday in New York at which U.S. President-elect Donald Trump may give more details of the policies he will seek to implement after he takes office on Jan. 20.

 

Trump's news conference could have an influence on the US dollar, equities, and even global financial markets as expectations of more economic stimulus from a Trump administration.

Among Asian bourses

Australia Market ends near 20-month high

Australian share market ended firmer, registering fifth straight session of gains, pushed up by financials and healthcare companies, in line with US stocks hitting new highs. At the closing bell, the benchmark S&P/ASX 200 index inclined 51.80 points, or 0.9%, to 5807.40, its highest close since May 5, 2015, while the broader All Ordinaries index added 48.70 points, or 0.84%, to close at 5857.70.

Solid buying in the financial sector formed the backbone for the day's gains, with top for lenders leading rally. Among major banks, Australia & New Zealand Banking Group inclined 1.2% to A$31.77, Westpac 1.5% to A$33.97, Commonwealth Bank of Australia 1.3% to A$85.26, and National Australia Bank 1.7% to A$32.06.

Healthcare stocks were also gained, with CSL ending up 1.6% to A$104, after the company announced it expects to launch its new treatment for haemophilia A in Europe, after securing marketing authorisation. The treatment, called AFSTYLA, is expected to be rolled out in the coming months.

Shares of energy companies also provided support, with Woodside Petroleum rising 1.3% to A$31.88 while Origin Energy added 1% to A$6.78 and Santos gained 2.4% to A$4.23. Whitehaven Coal shares slumped 1.8% to A$2.72 after the company announced geotechnical issued forced it to reduce its production guidance for its Narrabri mine in NSW. In August 2016, Whitehaven set expectations at 8 million tonnes for 2016 and 8.3 million tonnes for 2017. This has now fallen to between 7.5 million tonnes and 7.8 million tonnes.

Iron ore slid 3.4% to $US76.25 a tonne on Friday night, placing downward pressure on resource stocks. BHP Billiton declined 0.1% to A$25.47 and Rio Tinto shed 1.3% to A$59.35, while Fortescue dropped 3.8% to A$5.84.

China Stocks rise to 1-month peak

Mainland China stock market finished higher, boosted by news that China expected to achieve economic growth of 6.7% in 2016, within a targeted range set earlier. Most sectors gained ground, led by industry and utilities shares. The Shanghai Composite Index rose 0.54% to close at 3,171.24, marked the best closing level since 09 December 2016. The blue-chip CSI300 index, which tracks large companies in Shanghai or Shenzhen, added 0.48% to 3,363.90. The Shenzhen Composite Index, which tracks stocks on China's second exchange, added 0.3% to 1994.15. The ChiNext Index, which tracks China's NASDAQ-style board of growth enterprises, shed 0.17% to 1,961.62 points.

State-owned enterprises reform has been a driver in recent weeks, as China vowed to push forward mixed-ownership reforms in key sectors including aviation, defence, oil and telecommunications.

China South Industries Group Corporation has made preliminary proposals regarding mixed-ownership reforms in defence enterprises and will launch trial stock ownership plans in its listed subsidiary Chongqing Changan Automobile , Shanghai Securities News reported.

Shares of defense linked companies surged after a state-run tabloid said China would seek to "take revenge" should U.S. President-elect Donald Trump abandon the "one-China" policy. AVIC Aircraft closed up 5.3% to a four-month high.

Insurance shares added to recent gains, with China Life Insurance up 1.6% to 25.59 yuan, and New China Life Insurance adding 1% to 44.7 yuan.

Hong Kong Stocks edge up

The Hong Kong stock market closed higher for third consecutive session, on the back of strength in utility and services stocks, but gains were capped by increasing pressure from profit-taking after a two-week long rally. Hong Kong's benchmark Hang Seng Index closed 55.68 points, or 0.25%, higher at 22,558.69. The Hang Seng China Enterprises Index, known as the H-shares index, shed 8.73 points, 0.09%, to 9,602.32. Turnover reduced to HK$51.3 billion from HK$58 billion on Friday.

Shares of Macau casino operators inclined after several investment banks, including Bank of America Merrill Lynch and China International Capital Corp, expects Macau's gambling revenues to improve this year. Galaxy Entertainment surged 4.3% to HK$35.45, Wynn Macau climbed 3% to HK$13.04, and Sands China tacked on 2.7% to HK$34.55.

Energy plays also jumped after oil prices rose last week. PetroChina advanced 2.3% to HK$6.18, and Sinopec added 0.9% to HK$5.87.

State-owned financial conglomerate Citic rose 1.2% to close at HK$11.46, after McDonald's agreed to sell an 80% stake in its mainland and Hong Kong businesses to a consortium including Citic and Carlyle Group, according to a joint statement by the companies.

CITIC (00267) rose 1.2% to HK$11.46. The company led a consortium to acquire McDonald's Mainland China and HK businesses for up to US$2.08 billion.

CKH Holdings (00001) softened 0.2% to HK$90 on talks that its 3 UK failed to secure a five-year wireless virtual network contract from Virgin Media.

Indian Market slides amid mixed global cues

Key equity benchmark indices registered small losses in a lacklustre trading session. The barometer index, the S&P BSE Sensex, fell 32.68 points or 0.12% to settle at 26,726.55. The Nifty 50 index fell 7.75 points or 0.09% to settle at 8,236.05. Market sentiment was sombre amid weakness in European stock indices and mixed trend among Asian peers.

Aurobindo Pharma rose 0.27% after the company announced on Saturday, 7 January 2017, that it has received final approval from the US Food & Drug Administration (USFDA) to manufacture and market Levetiracetam in Sodium Chloride Injection, 500 mg/100 mL (5 mg/mL), 1000 mg/100 mL (10 mg/mL), and 1500 mg/100 mL (15mg/mL) (single-use bags). Aurobindo's Levetiracetam in Sodium Chloride Injection is a generic equivalent of HQ Specialty Pharma Corp's Levetiracetam in Sodium Chloride Injection. The product will be launched in January 2017.

Tata Steel rose 0.56% after the company announced that it has inaugurated the second phase of cold rolling mill (CRM) complex BARA at Jamshedpur on 5 January 2017. During phase I, the reversing mill of 0.25 million tonnes per annum (MTPA) capacity was installed at CRM BARA to meet the full hard cold rolled (FHCR) requirement of Tata Blue Scope (TBSL). The phase II expansion of CRM BARA includes installation of 0.3 MTPA hot rolled skin passing mill (HSPM) to meet the increased demand of hot-rolled, pickled, skin passed and oiled products (HRSPO) in the automotive sector for high-end customers. The announcement was made on Saturday, 7 January 2017.

Tata Motors rose 0.51% after the company's subsidiary Jaguar Land Rover's (JLR) total retail sales rose 12% to 55,375 units in December 2016 over December 2015. The sales growth was primarily driven by the ongoing success of the Jaguar F-PACE, Land Rover Discovery Sport and the Range Rover Sport as well as strong demand for the long wheel base Jaguar XFL in China. The announcement was made during market hours today, 9 January 2017.

Elsewhere in the Asia Pacific region: New Zealand's NZX50 was up 0.6% to 7012.74. South Korea's KOSPI index fell 0.02% to 2048.78.Taiwan's Taiex index slid 0.3% to 9342.42. Malaysia's KLCI dropped 0.45% to 1667.90. Indonesia's Jakarta Composite index fell 0.57% to 5316.36. Singapore's Straits Times index added 0.64% to 2981.540. Japan's stock market was closed for public holiday.

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