Investors risk sentiments turned downbeat after media reports that UK Prime Minister Theresa May would use a speech on Tuesday to signal plans for a hard Brexit''.
Investors' worries about a hard Brexit scenario rekindled after media reports that UK Prime Minister Theresa May would use a speech on Tuesday to signal plans for a hard Brexit''. In her speech on Tuesday, Ms. May is expected to elaborate on the U.K's priorities in negotiations over its exit from the European Union. Several British newspapers reported that Ms. May will emphasize that the U.K will leave the EU's single market to regain control of immigration policy.
In remarks reported by China's state media on Sunday, Premier Li Keqiang said China's economy will face more pressure and problems in 2017, with changes in global politics and challenges to economic rules adding to uncertainty. Official estimates issued on Friday said economic growth in some of the largest cities was expected to have slowed in 2016 and would continue to decelerate in 2017.
Among Asian bourses
Australia Market climbs as miners rally
Australian share market closed higher, boosted by materials and resources stocks, thanks to rise in iron ore and base metal prices. At the closing bell, the benchmark S&P/ASX 200 index inclined 27.30 points, or 0.48%, to 5748.40, while the broader All Ordinaries index added 26.20 points, or 0.45%, to close at 5803.
Shares of financial sector showed strong positive movement, with the four big banks leading rally. Among major banks, Australia & New Zealand Banking Group added 0.4% to A$30.79, Westpac 0.5% to A$33.06, National Australia Bank 0.1% to A$31.13, and Commonwealth Bank of Australia 0.3% to A$84.09.
Materials and resources shares closed higher after iron ore futures in China soared as much as 8% to a three-year high on Monday, powered by strong gains in steel prices. Copper prices rose, extending gains from last week on the back of strong economic data from the United States and China. Rio Tinto added 1.8% to A$63.22 and Fortescue Metals 2.9% to A$6.34. BHP Billiton jumped 1.7% to A$26.77. Copper miner OZ Minerals soared as much as 3.3% to hit a 4-1/2 year high. Gold Miners Newcrest Mining rose 2.1% to A$21.60.
DUET Group rose 5.4% to finish at a more than eight year-high after it agreed to recommend an increased $5.51 billion bid from a consortium led by Cheung Kong Infrastructure Holdings.
Nikki falls on yen strength, British exit woes
The Japan share market closed down, as risk aversion selloff triggered by yen ascent to around 114 per greenback amid fresh concerns over Britain's upcoming exit from the European Union. The 225-issue Nikkei average lost 192.04 points, or 1.00%, to close at 19,095.24. The Topix index of all first-section issues finished down 14.25 points, or 0.92%, at 1,530.64.
Stocks of Japanese exporters were hardest hit, with automakers Toyota, Mazda and Fuji Heavy, semiconductor-related Advantest and Tokyo Electron, and Alps Electric being major losers, after the yen strengthened against the greenback. The yen's rise came as investor anxieties grew over a so-called hard Brexit, or Britain's exit from the European Union with border controls prioritized over access to the EU market, following media reports that British Prime Minister Theresa May is expected to show such a policy in a speech on Tuesday. A stronger yen hurts Japanese exporters as it makes their products more expensive abroad and reduces the value of repatriated profits.
Oil companies JX Holdings, Inpex, Japan Petroleum Exploration, Showa Shell Sekiyu and TonenGeneral Sekiyu were downbeat due to a fall in New York crude oil prices on Friday.
Japan Post Holdings dived 4.9% on reports that the Japanese Ministry of Finance plans to additionally sell shares worth up to 1.4 trillion yen in the company this summer at the earliest.
Nippon Steel & Sumitomo Metal lost 4.14% after the company said Friday that it is likely to take about eight months to restart steel plate production at its steelworks in the city of Oita following a fire there on Jan. 5.
China Stocks falls for fifth day
Mainland China stock market ended down for fifth straight session, weighed down by heavy losses in small cap stocks amid anxiety over liquidity squeeze in the financial system after faster approvals for initial public offerings (IPO) and increasing issuance of additional shares by listed companies. Risk sentiments were also downbeat on growing uncertainty about 2017 growth prospects following comments by the premier and official estimates suggesting slowing economic growth in big cities. Most of sectors lost ground, led down by properties and consumer shares. The blue-chip CSI300 index, which tracks large companies in Shanghai or Shenzhen, edged down 0.01% to close at 3,319.45. The Shanghai Composite Index fell 0.3% to close at 3,103.43. The Shenzhen Composite Index, which tracks stocks on China's second exchange, dropped 3.62% to 1851.41. The ChiNext Index, which tracks China's NASDAQ-style board of growth enterprises, shed 3.64% to 1,830.85 points.
The China Securities Regulatory Commission (CSRC) approved 131 new IPOs in the last quarter of 2016, up sharply from the 28 it approved in the last three months of 2015. There were 45 IPOs on China's exchanges last month alone, the most since 1997.
In remarks reported by state media on Sunday, Premier Li Keqiang said China's economy will face more pressure and problems in 2017, with changes in global politics and challenges to economic rules adding to uncertainty. Official estimates issued on Friday said economic growth in some of the largest cities was expected to have slowed in 2016 and would continue to decelerate in 2017.
Most sectors lost ground, led by properties and consumer shares. Nearly 100 smaller-cap stocks tumbled 10%, the maximum allowed.
Sunac China Holdings slumped 8.1% after it announced a plan to invest $2.2 billion in three companies affiliated with Chinese tech tycoon Jia Yueting's LeEco empire
Hong Kong Stocks fall on hard Brexit woes
The Hong Kong stock market ended lower, dragged down by tracking drop in Mainland China stocks and on concerns over the impact of Britain's exit from the European Union. Nearly all sectors on the Hong Kong bourse lost ground, with telecommunication firms and oil majors that had rallied earlier on restructuring hopes corrected under profit-taking pressure.
The Hang Seng Index declined 0.96% or 219.23 points to close at 22,718.15. The Hang Seng China Enterprises index, or the H-share index, fell 1.24% or 121.25 points to 9,666.09. Turnover was largely unchanged from Friday at HK$56.8 billion.
Cathay Pacific (00293) put on 3% to HK$10.86 on reports that the carrier may announce job cuts and cost-saving plans. It became the biggest blue-chip gainer. Mengniu Dairy (02319) was the largest blue-chip loser, falling 2.8% to HK$14.66.
Companies with European exposure ended lower after UK media speculated that May may announce hard Brexit. Theresa May, the Prime Minister for the UK, is scheduled to deliver speeach regarding Brexit tomorrow. CKH Holdings (00001) slipped 1.6% to HK$90.6. HSBC (00005) dipped 1.3% to HK$63.2.
Property developer Sunac China dived as much as 10% and closed lower by 8.1%% at HK$6.7, after the company announced its plans to invest 15 billion yuan in the troubled technology company LeEco.
Power Assets Holdings jumped 2.8% to HK$72.5, and Cheung Kong Infrastructure gained 1% to HK$61.55, after a consortium comprising Li Ka-shing's Cheung Kong Property, Cheung Kong Infrastructure and Power Assets announced a plan to acquire Duet Group in Australia for HK$43 billion.
HKT Trust (06823) surged 9.5% to HK$10.4 after it reported net profit of HK$4.9bn, up 24% year-on-year. It declared final distribution per share of 34.76 HK cents. The stock surged 9.5% to HK$10.4.
Sensex, Nifty settle at highest level in 9-1/2 weeks
Indian benchmark indices settled with small gains, shrugging off weak trend in global stocks as domestic data showing fall in trade deficit in December extended support amid another data showing slight rise in wholesale inflation. The barometer index, the S&P BSE Sensex, rose 50.11 points or 0.18% to settle at 27,288.17. The Nifty 50 index gained 12.45 points or 0.15% to settle at 8,412.80.
In sectoral trends, bank stocks edged higher. Metal & mining stocks gained on renewed buying. IT stocks edged lower.
Among stock specific action, private sector lender Axis Bank advanced after the bank announced the cut in Marginal Cost of Funds based Lending Rates (MCLR) by 65-70 basis points across the various tenures with effect from 18 January 2017. Software major Infosys extended previous trading session's decline triggered by the company lowering the upper band for revenue growth guidance in constant currency terms for the current financial year (FY 2017). Automobile major Tata Motors advanced after a foreign brokerage reportedly raised target price on the stock to Rs 650 from Rs 585 earlier on likely significant improvement in both Jaguar Land Rover (JLR) and India businesses.
Elsewhere in the Asia Pacific region: New Zealand's NZX50 was up 0.45% to 7069.59. South Korea's KOSPI index shed 0.6% to 2064.17. Taiwan's Taiex index eased 0.9% to 9292.33. Malaysia's KLCI dropped 0.8% to 1658.84. Indonesia's Jakarta Composite index fell 0.1% to 5270. Singapore's Straits Times index shed 0.4% to 3013.12.
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