Investors digested U.S. President-elect Donald Trump's remarks on the U.S. dollar and British Prime Minister Theresa May's statement that her country will leave the European single market when it quits the European Union.
On Wall Street, stocks closed lower on Wednesday after the long holiday weekend following British Prime Minister Theresa May's "Brexit" speech in which she said the U.K. will not seek to "hold on to bits of EU membership". May also said Britain will not seek to remain in the single market, as it would mean not leaving the EU at all. The Dow fell 58.96 points or 0.3% to 19,826.77, the Nasdaq slid 35.39 points or 0.6% to 5,538.73 and the S&P 500 dipped 6.75 points or 0.3% to 2,267.89.
The major European markets also moved lower on Tuesday. While the U.K.'s FTSE 100 Index tumbled by 1.5%, the French CAC 40 Index fell by 0.5% and the German DAX Index edged down by 0.1%.
Among Asian bourses
Australia Market ends down for second day
Australian share market ended down for second straight session, on tracking weak lead from Wall Street and European markets overnight, Most sectors lost ground, with shares in the Healthcare, Financials and Consumer Discretionary sectors leading losses. At the closing bell, the benchmark S&P/ASX 200 index declined 20.60 points, or 0.36%, to 5678.80, while the broader All Ordinaries index dropped 21 points, or 0.36%, to close at 5733.70.
Shares of healthcare sector underperformed the most after Trump told the Washington Post that he would target companies over drug pricing and would replace Obamacare with a plan that would envisage "insurance for everybody". U.S.-exposed ResMed Inc dropped 3% to A$8.37, while CSL declined 1.1% to A$99.12.
Shares of financial sector also trapped with selloff pressure, with the big four banks driving the losses. Among major banks, Australia & New Zealand Banking Group declined 1% to A$30.11, Westpac 1% to A$32.43, National Australia Bank 0.7% to A$30.58, and Commonwealth Bank of Australia 0.8% to A$82.66.
Japan Stocks settle higher after volatile ride
The Japan share market settled higher after wavering above and below break-even throughout the day, thanks to bargain hunting and yen decent against major currencies. But market gained capped on caution ahead of the new president's inauguration later this week as uncertainty continues to swirl around Mr. Trump's plans for taxes and spending. The benchmark Nikkei gained 0.43%, or 80.84 points, to end the day at 18,894.37, while the Topix index of all first-section issues rose 0.32%, or 4.76 points, to 1,513.86.
Export-related stocks benefited from the yen retreat against the dollar. The dollar was trading at 113.25 yen Wednesday afternoon, rebounding from below 113 yen earlier in the day. A weaker yen is positive for Japanese exporters as it makes their products more competitive abroad and inflates the value of their repatriated profits. Toyota closed 0.25% higher at 6,736 yen while Sony fell 0.57% to 3,484.
Shares of banks and financials benefited from prospects of higher interest rates underperformed, as U.S. Treasury yields have trended lower in recent sessions. Mitsubishi UFJ Financial Group Inc. declined 0.5% to 711.5 yen. Mizuho Financial Group Inc. dropped 0.5% to 207.3 yen.
Steel makers and real estate developers rose, recovering somewhat from losses in recent sessions. Nippon Steel & Sumitomo Metal Corp. gained 4.9% to 2,685.5 yen. Major property developer Mitsui Fudosan Co. advanced 2.8% to 2,639.5 yen.
Industrial conglomerate Toshiba Corp. gained 2.4% to 288.4 yen after saying it was considering spinning off of its profitable semiconductor unit, a plan that could help it raise cash in response to a multibillion-dollar write-down at its nuclear power plant business.
China Stocks gain on PBOC liquidity injection
Mainland China stock market ended higher for second straight session, on the back of blue chip's solid 2016 earnings projection and the central bank continued liquidity injection into the banking system as the Chinese New Year holiday approaches. Maret gains were, however, limited amid renewed weakness in small-caps and worries about Donald Trump's approach to Beijing. Sectors advanced across the board, with infrastructure stocks leading the gains. The blue-chip CSI300 index, which tracks large companies in Shanghai or Shenzhen, was up 0.39% to close at 3,339.37. The Shanghai Composite Index added 0.14% to close at 3,113.01. The Shenzhen Composite Index, which tracks stocks on China's second exchange, declined 0.45% to 1864.59. The ChiNext Index, which tracks China's NASDAQ-style board of growth enterprises, shed 1.18% to 1,845.79 points.
Heavyweight Baoshan Iron & Steel Co Ltd added more than 1.6% after the company expects net profit in 2016 to be nearly eight times the previous year's level. Baosteel and other cyclical companies involved in the production of building materials have benefitted from higher government spending on infrastructure projects and a housing market rally, which have sparked a construction boom.
Hang Seng hugs the psychologically key 23,000 level
The Hong Kong stock market ended two and half a month high. The rally on the Hong Kong bourse comes as the British Prime Minister delivered her policy speech on Brexit on Tuesday, easing mounting concerns on how she planned to exit the European Union which sent the pound soaring overnight, as well as pushing up stocks with exposure to European market. The Hang Seng Index added 1.13% or 257.29 points to close at 23,098.26. The Hang Seng China Enterprises index, or the H-share index, rose 1.04% or 100.67 points to 9,802.86. Turnover increased to HK$68.5 billion from HK$50.7 billion on Tuesday.
The pound's rebound lent support to companies with European exposure. CKH Holdings (00001) added 1.4% to HK$91.7. Cheung Kong Infrastructure, with 60% of its net profit derived from the UK, climbed 1.9% to HK$62.1. CK Property (01113) jumped 3.4% to HK$52.4 after Li Ka-shing announced on Tuesday a plan to spend HK$183.3 million buying its shares at HK$50 to HK$50.8. The repurchase plan came after Li announced on Monday that three of his firms would acquire Australian energy company Duet Group.
Morgan Stanley revised upwards its target prices for a number of banks. BOCHK (02388) jumped 3% to HK$30.4. HSBC (00005) rose 0.8% to HK$64.7. Hang Seng Bank (00011) added 2% to HK$152.7.
AAC Tech (02018) shot up 2.7% to HK$78.25 after Morgan Stanley upgraded its higher target price to HK$80. Sunny Optical (02382) soared 3.9% to HK$42.35.
MGM China (02282) said the opening date of MGM Cotai will be delayed to the second half of 2017. It dipped 2.4% to HK$14.78. Galaxy Entertainment (00027) and Wynn Macau (01128) also added 1% and 2.7% to HK$35.8 and HK$13.02.
Indian Market settles with minor gains
Key benchmark indices settled with tiny gains after a volatile session of trade amid mixed cues from the global stocks. The barometer index, the S&P BSE Sensex, rose 21.98 points or 0.08% to settle at 27,257.64. The gains of the Nifty 50 index were higher than those for the Sensex in%age terms. The Nifty 50 index gained 19 points or 0.23% to settle at 8,417. In sectoral trend, bank stocks nudged higher. Metal & mining stocks witnessed buying interest. Telecom stocks ended in red.
Among stock specific action, State Bank of India (SBI) edged higher after the bank said that it concluded the issue of $500 million fixed rate senior unsecured notes having a maturity of 5 years at a coupon of 3.25% payable semi-annually.
Back to key indices, earlier during the day, key indices had regained positive terrain after slipping into the red for a brief period after witnessing initial gains triggered by reports suggesting that the Central Board of Direct Taxes put in abeyance its earlier circular raising foreign investors' concerns over a potential rise in tax liability under indirect transfer provisions.
Among other Asian market South Korea's KOSPI Index declined 1.33 points or 0.06% to settle at 2,070.54 in choppy trade. New Zealand's benchmark S&P/NZX-50 index edged down 3.69 points or 0.05% to settle at 7,059.27. Also, Singapore's Straits Times Index dipped 0.42% and Taiwan's Weighted Index declined 0.13%.
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