Asia Pacific stock markets closed largely higher on Wednesday, January 09, 2013, as the earnings season got off to a positive start in the US, with aluminum major Alcoa Inc swung to a fourth-quarter profit and expects global aluminum demand to grow 7% in 2013.
Alcoa, an industrial bellwether that unofficially kicks off the quarterly earnings season in the US, posted a profit of $242 million, or 21 cents a share, compared with a year-earlier loss of $191 million, or 18 cents a share. Revenue edged down 1.5% to $5.9 billion. Looking ahead to the current year, company said it expects global aluminum demand to grow 7% in 2013, compared with 6% in 2012.
Alcoa's results are generally considered a bellwether for the global economy, and the fact that the aluminum giant forecasts higher demand in 2013 appeased investors.
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Market participant has become less worrying over global growth after the US could avert the fiscal cliff in the short-term. However problems still remain in the long term, especially about a further debt ceiling raise as long as the US is keeping a budget deficit policy. Meanwhile, the US leading economic indicators have been improving, signaling that the QE might be terminated soon. This is another factor to hinder global stock markets.
For the Euro-zone, a progress in Greek financial aids has alleviated concerns for a while (as well as concerns toward Spain, reflecting from yield on Spanish long-term bonds which is standing low at only 5.1% from the peak of 7.6% in the middle of last year), although the EU leading economic indicators are still giving a sign of weakness. However, as developed countries have been imposing loose monetary policies for a long time, they would consequently be slowed down from now on.
In the Asia Pacific, Tokyo shares staging a turnaround today as the yen headed back down during the session, with the Nikkei Stock Average climbing 70.51 points, or 0.67%, to end the day at 10,578.57. Buying gradually increased as the dollar began to rise again from the upper-86 yen range. Speculative purchases of stock index futures and short-covering also pushed up the benchmark Nikkei average, which tumbled 109 points at the market open. Blue chips, including shares of carmakers and financial firms, turned upward across the board, after trading lower in the morning, as investors took another look at issues that had corrected earlier in the week.
Australian share market closed higher to end a three day run of losses and defy weaker than expected retail sales figures. At the close today, the benchmark S&P/ASX200 index was 17.9 points, or 0.38%, higher at 4708.1, while the broader All Ordinaries index was up 17.8 points, or 0.38%, at 4730.1.
Australian miners advanced, led by Alumina after its joint venture Partner Alcoa kicked off the US earnings season after Wall Street closed, delivering fourth quarter earnings in line with expectations and forecasting slightly higher demand for aluminum in 2013. Alumina shares were up 4.6% at A$1.03. BHP Billiton rose 0.2% to A$37.58 and Rio Tinto gained 0.3% to A$66.81. Gold miner Newcrest Mining dropped 0.8% to A$2.02
Australian retail sales unexpectedly fell in November, adding to evidence that a slowdown in China last year was hurting more than just the resource-rich country's mining industry. The latest Australian Bureau of Statistics Retail Trade figures show that Australian retail turnover fell 0.1% to A$21.5 billion in November 2012, seasonally adjusted, following a relatively unchanged October 2012 (0.0%).
New Zealand shares climbed today, nudging the NZX 50 to a five-year high, led by high dividend yielding players such as OceanaGold, Kathmandu and Telecom. The NZX 50 Index rose 13.17 points, or 0.3%, to 4103.54. Within the index, 24 stocks rose, 18 fell and eight were unchanged. Turnover was $130.8 million. OceanaGold, which operates the Macraes gold field, rose 6.2% to NZ$3.43. Kathmandu, the children's clothing chain, gained 3.4% to NZ$2.11. Telecom, which has a dividend yield of 13.3%, rose 3.1% to NZ$2.31. Sky City Entertainment, the casino and hotel company, rose 1.1% to NZ$3.81. It has a dividend yield of 5.8%.
South Korea stocks lost ground today, falling for a fifth consecutive session on apprehensions over fourth-quarter earnings. The benchmark Kospi Average slipped 0.3% to 1,991.81. Market heavyweight Samsung Electronics ended on a flat note following the 1.3% decline yesterday after the company said it likely earned a quarterly operating profit of 8.8 trillion won in the fourth quarter of 2012. Online game developer NCsoft tumbled 4.5% after Morgan Stanley cut its price target on the stock.
Mainland China shares ended largely mixed as investors traded cautiously amid market correction. The benchmark Shanghai Composite Index edged down 0.73 points to 2275.34 on turnover of 102.8 billion yuan. Market confidence is recovering as the Chinese economy is stabilizing thanks to stimulus measures but investors seem to adopt a more cautious stance after the market surged rapidly in a short term and global ratings agency Fitch has warned that China's investment-driven growth model faces increasingly serious constraints due to heavy debt financing by local governments.
Zoomlion Heavy Industry Science and Technology Co. sank 3.2% to 8.90 yuan as it denied a Ming Pao Daily report questioning the company's sales. Zoomlion's shares were suspended from trading yesterday. Its American depositary receipts dropped the most in two weeks in New York yesterday.Ping An, China's second-biggest insurer, lost 0.4% to 45.07 yuan on report insurance regulator is set to reject Charoen Pokphand Group's proposed $9.4 billion purchase of HSBC's stake in Ping An on concerns the group may not be able to fund the acquisition.
Hong Kong shares ended higher, snapping a three-day losing streak, as the US earnings season got off to an upbeat start. The benchmark Hang Seng Index rose 107.28 points to 23,218.47 on turnover of HK$75.47. Guangzhou Automobile Group Co., a Chinese partner of Toyota Motor Corp., jumped 7.4% to HK$738 after Credit Suisse raised its rating to neutral from underperform. Aluminum Corp. of China, the China's biggest producer of the metal, gained 1.1% to HK$3.82 after sales at Alcoa Inc. beat analysts' estimates.
Singapore shares advanced today, led by shopping mall owner CapitaMalls Asia, but gains were limited as investors stayed on the sidelines ahead of a European Central Bank policy meeting on Thursday. By provisional closing, the benchmark Straits Times Index was up 0.5% at 3,220.41. CapitaMalls Asia, which is seen as a good proxy to China's economic recovery, rose 2.5% today. It is the strongest performer on the STI so far this year, rising 8.8%. Last year, it surged 72%, beating the benchmark's 19% gains.
Malaysia blue chips took a breather today as investors locked in recent gains but the overall market sentiment did show some improvement later in the day, with plantation stocks providing the support for the market. The benchmark Kuala Lumpur Composite Index was up 1.02 points or just 0.06% to 1,689.93. Turnover was 1.10 billion shares valued at RM1.58 billion. The better-than-expected export data did provide some reassurance to investors, where the export growth in November of 3.3% beat consensus' expectations of 2.3%.
Malaysia's exports totaled 58.67 billion ringgits ($19.3 billion) in November, up from MYR56.82 billion a year earlier, the Ministry of International Trade and Industry said in a statement Wednesday. October exports had shrunk 3.2% while September exports grew 2.6% after two successive months of contraction. Imports grew 4.3% in November from a year earlier to MYR49.39 billion, driven by intermediate goods. The trade surplus for November amounted to MYR9.28 billion, narrowing from October's MYR9.58 billion surplus, the ministry added.
Indian markets were volatile in late noon deals with the Sensex wiping out gains to end into the red as two-wheeler makers such as Bajaj Auto retreated after an industry body cut its estimates for motorcycle sales, while software services exporters such as Tata Consultancy Services fell ahead of upcoming earnings results. The Sensex provisionally fell 0.4%, while the Nifty retreated 0.5%.
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