Asia Pacific share market finished mixed on Monday, 17 October 2016, as traders digested U.S. Federal Reserve Chair Janet Yellen's Friday speech and awaited US and Chinese data due this week.
Investors are watching key economic data including those on industrial production and inflation to weigh the outlook for when the Federal Reserve will raise borrowing costs. Fed Chair Janet Yellen signaled Friday the central bank will remain deliberate in raising interest rates as the odds for monetary tightening in December hovered above 60%.
On tap later this week is a deluge of data from China, including third-quarter gross domestic product (GDP), house prices, industrial production numbers, retail sales and fixed asset investment.
On Friday, Yellen said the central bank might want to let inflation run hotter for a while, pointing out that the economy had seen an unusual tendency for weak demand against strong supply. She said that made it reasonable to ask if there was a possibility to reverse adverse supply-side effects by temporarily running an economy with robust aggregate demand and a tight labor market.
Among Asian bourses
Australia Market sinks 0.83%
Australian share market stumbled on risk-off selloff across the board, with gaming, realty, utilities, pharma, industrial, and resources stocks leading losses. At the closing bell, the benchmark S&P/ASX 200 index declined 45.30 points, or 0.83%, to 5,388.70, while the broader All Ordinaries index was down 47.60 points, or 0.86%, to 5,470.90. Falling stocks outnumbered advancing ones on the Australia Stock Exchange by 682 to 385 and 306 ended unchanged. The S&P/ASX 200 VIX, which measures the implied volatility of S&P/ASX 200 options, was up 3.38% to 14.602.
Shares in Crown Resort tumbled 13.9% to A$11.15 following news that 18 of its employees, including its executive vice president VIP International, Jason O'Connor, were detained after a weekend raid of its offices. Shares in fellow casino operators Star Entertainment and SkyCity fell in sympathy, down 3.7% and 3.9% respectively.
Shares of resources, particularly coal miners, inclined on tracking strength in coal prices. Whitehaven Coal closed 3.5% higher after the coal miner said it expects coal prices to remain strong through the December quarter after settlements in Asian markets helped cut its borrowings. In a market update, the company said the price of semi-soft coking coal has surged to $US130 a tonne, higher than the $US70 a tonne Whitehaven fetched during the September quarter. South32 added 0.4%. Fortescue Metals Group was the day's strongest stock by weight, up 2.7%.
Japan Market gains on yen easing
The Japan share market finished higher after swinging between gains and losses on the back of positive lead from Wall Street last Friday and the yen's moderate easing against the dollar. However, market topside capped amid a wait-and-see mood before the release of key U.S. economic data this week and earnings from Japanese firms that fully kick off next week. The 225-issue Nikkei average gained 43.75 points, or 0.26%, to close at 16,900.12. The Topix index of all first-section issues ended up 5.37 points, or 0.4%, at 1,352.56. Rising stocks outnumbered declining ones on the Tokyo Stock Exchange by 1841 to 1031 and 410 ended unchanged. The Nikkei Volatility, which measures the implied volatility of Nikkei 225 options, was down 0.55% to 19.90.
Japan Display Inc. surged 8.3%, leading gains on the Topix Electric Appliances Index, after SMBC Nikko Securities Inc. raised its rating on the stock to outperform from neutral.
Fukushima operator Tokyo Electric Power Co. slumped 7.9%, the biggest drop on the Nikkei 225 Stock Average, on dimming hopes that reactors at Kashiwazaki-Kariwa, the world's largest nuclear plant, will be restarted as candidate opposed to the restart of Tepco's Kashiwazaki Kariwa nuclear plant won the gubernatorial race for Niigata prefecture, where the reactor is located, blurring the outlook for Japan's largest power utility.
Aderans Co., a wig maker, soared 17% after the firm received a buyout offer that represents a 29% premium to the stock's Friday closing price.
TSI Holdings Co., a manufacturer of men and women's clothing, climbed 7% after the company reported 830 million yen ($8 million) in operating profit for the six months ended August, swinging from a loss of 422 million yen in the year-earlier period.
China Stocks drop 0.85%
Mainland China stock market finished the session down on Monday, 17 October 2016, with sentiment soured by a late-afternoon tumble in Shanghai's U.S. dollar-denominated B shares as the yuan continued to weaken. All main sectors fell, with real estate shares leading the decline. The CSI300 index of the largest listed companies in Shanghai and Shenzhen dropped 0.85%, to 3,277.88 points, while the Shanghai Composite Index declined 0.74% to 3041.17 points.
The B-share sell-off comes amid increasing worries about yuan's value, which touched a fresh, six-year low against the greenback on Monday. B-shares are dollar-denominated shares in Chinese companies, and thus vulnerable to further yuan depreciation.
China's yuan weakened against greenback on Monday as the People's Bank of China set the midpoint rate at 6.7379 per dollar prior to market open, weaker than the previous fix of 6.7157. but decline was limited as traders were hesitant to buy greenbacks amid concern the central bank may step in try to halt the Chinese currency's slide. The spot market opened at 6.7318 per dollar and was changing hands at 6.7329 at midday, 58 pips away from the previous late session close and 0.07% firmer than the midpoint.
Hong Kong Stocks fall 0.84%
The Hong Kong stock market closed down, on tracking weak cues from other regional bourses, with casino-related stocks leading losses on news that Chinese authorities detained employees at casino operator Crown Resorts for suspected gambling crimes. The Hang Seng Index was down 0.84% or 195.77 points to 23,037.54, while the Hang Seng China Enterprises Index dropped 0.63% or 60.32 points to 9,541.08. Turnover decreased to HK$53.6 billion from HK$60.3 billion on Friday.
Macau gaming counters led the decline on news that China authorities have detained 18 employees of Australian casino giant Crown Resorts for gambling crimes. Galaxy Entertainment (00027) and Sands China (01928) slid 4.3% and 3.3% to HK$29.3 and HK$33.85. The stocks were the top blue-chip losers today.
Standard Chartered (02888) soared 3% in early London trade, triggering late buying orders of its shares in HK. It ended up 1.5% to HK$62.6. HSBC (00005) edged down 0.8% to HK$58.05.
CRRC Times Electric (03898) jumped 3.7% to HK$39.65 after Macquarie upgraded its rating for the stock to "outperform" from "neutral". China Communications Construction (01800) edged up 0.1% to HK$8.26.
Indian Market tumbles on weak European cues
Auto, telecom sector stocks and index heavyweights Reliance Industries, HDFC and HDFC Bank led modest losses for key benchmark indices in a volatile trading session. The barometer index, the S&P BSE Sensex, fell 143.63 points or 0.52% to settle at 27,529.97. The Nifty fell 63 points or 0.73% to settle at 8,520.40. Weakness in European stocks weighed on sentiment on the domestic bourses.
Data released by the government after market hours on Friday, 14 October 2016 showed that India's trade deficit narrowed to $8.34 billion in September 2016, from $10.17 billion a year earlier. Imports declined 2.54% to $31.22 billion. Exports rose 4.62% to $22.88 billion.
UltraTech Cement fell 0.74% at Rs 4,008.70. On a consolidated basis, the company's net profit rose 25.05% to Rs 614 crore on 2.52% decline in net sales to Rs 5709 crore in Q2 September 2016 over Q2 September 2015. The result was announced during market hours today, 17 October 2016.
Elsewhere in the Asia Pacific region: New Zealand's NZX50 fell 0.9% to 706.37. Indonesia's Jakarta Composite index grew 0.2% to 5410.30. Taiwan's Taiex added 0.1% to 9176.22. South Korea's KOSPI index rose 0.2% to 2027.61. Malaysia's KLCI was down 0.3% at 1653.71. Singapore's Straits Times index added 0.1% to 2817.07.
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