Investment sentiments turned bearish across the regional bourses on caution before the release of the advance estimate of U.S. third quarter economic growth later Thursday and October jobs figures on Friday.Both reports could signal how much longer the Federal Reserve will continue its bond purchases at the current $85 billion a month rate. That program has held down interest rates, kept bond yields low and made stocks more attractive for investors.
Meanwhile, sentiments were also bearish on caution ahead the China's once in a decade leadership plenary meeting which begins at the weekend. The third plenary session of the 18th Congress of the CPC Central Committee will take place between November 9 and November 12 to craft a new blueprint for the world's No. 2 economy as the country heads for its slowest annual growth in more than two decades. Hopes are high that the plenum will announce changes to give private businesses a greater say in the economy but reforms will face resistance from officials and state companies who benefit from the status quo.
Among Asian bourses, shares on the Japanese share market declined, dragging the benchmark Nikei225 index falling 108.87 points, or 0.76%, to finish the session at 14228.44.
Daikin Industries added 0.7% to 5,830 yen after the firm's second quarter operating profit rose 78% on-year to 50.3 billion yen. The firm also announced a fiscal year-end dividend forecast of 46 yen per share, up 10 yen.
Game maker Namco Bandai Holdings gained 8% to 1,996 yen after its second quarter operating profit of 13 billion yen. It too raised its full-year guidance to 45 billion yen from 40 billion yen.
Apple iPhone parts maker Japan Aviation Electronics Industry gained 15% to 1,123 yen after raising its operating profit target to 12.5 billion yen from 11 billion yen for the business year-end. It revised up its annual dividend forecast to 15 yen from 10 yen.
In Australia, shares on the Australian financial market declined, weighing the benchmark S&P/ASX200 down by 0.22% to 5422, with shares of precious metal, financials, and mining companies led losses.
Shares of Australian precious metal producers declined on tracking weakness in the bullion prices in the international market today. The gold spot price dipped 0.1 per cent to $US1317.30 an ounce at the local close. Newcrest Mining fell 0.6 per cent to $10.13. Junior gold miner St Barbara lost 15.7% at A$0.35 after Moody's downgraded its credit rating.
Australian banking and financial stocks finished lower as the companies went ex-dividend today, with Australia & New Zealand Banking Group falling 4.2% to A$32.38 as it paying a 91c dividend. Meanwhile, Westpac Banking Corp fell 0.5% at A$34.23. National Australia Bank dropped 3.4% to A$34.68 as it pays out a 97c fully franked dividend to shareholders.
Commonwealth Bank shares rose 1.7% to A$79.32 on the top of 1.3% gins prior day after the lender said profit rose to A$2.1 billion in the three months through September from A$1.8 billion a year earlier, citing a dip in impaired assets and gains from tighter cost control.
The Australian Bureau of Statistics said on Thursday that Australia's seasonally adjusted unemployment rate increased 0.1 percentage points to 5.7 per cent in October. The trend unemployment rate increased less than 0.1 percentage point to 5.8%. On a seasonally adjusted basis, the number of people unemployed increased by 9,100 people to 709,300 in October, the ABS reported.
The ABS reported the number of people employed increased by 1,100 to 11,639,200 in October. The increase in employment was due to increased part-time employment, up 28,900 to 3,544,500 which was offset by decreased full-time employment, down 27,900 people to 8,094,700. The increase in total employment was mainly driven by an increase in male part-time employment. The ABS monthly seasonally adjusted aggregate hours worked series showed an increase in October, up 6.2 million hours to 1,648.5 million hours. The ABS reported the seasonally adjusted labour force participation rate was steady at 64.8 per cent in October.
In China, shares in the Chinese financial market drifted lower, dragging the benchmark Shanghai Composite index down by 0.48% to 2129.40, on rekindled worries about liquidity crunch in the market after the central bank suspended liquidity injection today.
The People's Bank of China today halted its open market operation after pumping 8 billion yuan into the money market through seven-day reverse repurchase agreements on Tuesday. The suspension will lead to a net withdrawal of 5 billion yuan from the market this week.
Brokerages declined after data showed the gross profit of 16 listed securities companies shrank 63% month-on-month to 970 million yuan in October. Haitong Securities lost 2.9% to 10.97 yuan after reporting a 64.5% slump in October profit while Soochow Securities Co dropped 0.8% to 7.38 yuan.
Shares of food and beverage companies ended lower, with Inner Mongolia Yili Industrial Group Co falling 4.4% to 37.65 yuan while Bright Dairy & Food Co plunged 7.2% to 20.26 yuan.
In Hong Kong, HK shares drifted lower for four consecutive trading days, weighing the Hang Seng Index down by 0.68% to 22881.03, on tracking weak cues from Mainland China bourses and on caution ahead of key US data that will provide further clues on when the Federal Reserve will cut monetary stimulus.
Among the HK 50 blue chips, 43 stocks fell and 7 rose. China Resources Power Holdings Co was top blue-chip loser, falling 2.7% to HK$19.26. Lenovo Group rose 2.1% to HK$8.60, becoming the top blue-chip winner, after the personal computer maker beat expectations by posting a 36% increase in its quarterly net profit at a time that most PC firms are struggling. HSBC (00005) fell 0.9% to HK$85.85 on potential fines by the EU regarding interbank rate fixing accusation. China Mobile (00941) edged up 0.1% to HK$81.3.
In India, Indian benchmark indices edged lower, in what was a highly volatile trading session after global credit rating agency Standard and Poor's (S&P) today, 7 November 2013, warned that it may lower India's rating to speculative grade from investment grade next year if the government that takes office after the general election fails to provide a credible plan to reverse the country's low economic growth. The Sensex fell 72.17 points or 0.35%, off close to 320 points from the day's high and up about 26 points from the day's low.
Global credit rating agency Standard and Poor's (S&P) today, 7 November 2013, affirmed its 'BBB-/A-3' sovereign credit rating on India while retaining negative rating outlook on Asia's third-largest economy. S&P said in its statement that India's institutional strengths and high international reserves supported its investment-grade rating on India. However, the agency noted a marked slowdown in India's real growth, which complicates the government's debt dynamics and ability to implement reforms. S&P added that the outlook remained negative, indicating that it may lower the rating to speculative grade next year if the government that takes office after the general election does not appear capable of reversing India's low economic growth. Alternatively, the credit ratings agency said it may revise India's outlook back to "stable" should a new government have an agenda to restore growth, improve the country's finances, or allow the implementation of an effective monetary policy. S&P added it will conduct its next review on India's ratings after the elections, which are due by May 2014, unless the country's fiscal or external standing deteriorates.
Shares of Indian lenders declined the most, with declined included Bank of Baroda (down 5.91%), United Bank of India (down 5.6%), Dena Bank (down 5.38%), Central Bank (down 4.99%), Andhra Bank (down 4.28%), Bank of India (down 4.25%), Canara Bank (down 4.24%), Punjab & Sind Bank (down 4.04%), Oriental Bank (down 3.92%), State Bank of Mysore (down 3.77%), UCO Bank (down 3.53%), Indian Bank (down 3.26%), State Bank of India (down 3.17%), Vijaya Bank (down 3.11%), Corporation Bank (down 2.93%), Bank of Maharashtra down 2.82%), Punjab National Bank (down 2.66%), Union Bank of India (down 2.49%), Syndicate Bank (down 2.49%), IDBI Bank (down 2.33%), State Bank of Bikaner (down 2.29%), Allahabad Bank (down 2.16%) and Jammu & Kashmir Bank (down 0.55%), edged lower.
Titan Industries lost 2.79% after the Reserve Bank of India put restriction on fresh foreign portfolio investment in the company's shares. The Reserve Bank of India (RBI) after market hours on Wednesday, 6 November 2013, notified that the aggregate net purchases of equity shares in Titan Industries by foreign institutional investors (FIIs) in the primary/secondary markets under Portfolio Investment Scheme (PIS) had reached the trigger limit. Hence, further purchases of equity shares of the company would be allowed only after obtaining prior approval of the RBI.
Wockhardt surged 6.33% after the UK health regulator allowed its Kadaiya, Nani Daman facility to manufacture and supply most of the products approved to be produced at the unit. The announcement was made after market hours on Wednesday, 6 November 2013.
Elsewhere in the region, New Zealand's NZX 50 index fell 0.44%. Indonesia's Jakarta Composite index added 0.82%. South Korea's KOSPI fell 0.48%. Taiwan's Taiex index added 0.02%. Malaysia's KLSE Composite shed 0.2%. Singapore's Straits Times index fell 0.1%.
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