Regional stocks took a negative lead from United States equities. US share market fell on Friday as investors took profits on high-flying momentum stocks in the technology and biotech sectors after widely anticipated data showed that the US economy added fewer than expected jobs in March.
Investors alarmed by another slide in U.S. technology stocks on Friday unloaded their tech holdings in regional bourses. High-flying technology stocks around the world have registered widespread losses today as investors question fast-rising valuations.
However, losses in the regional bourses were limited as concerns about an early US interest rate hike calmed after the nonfarm payrolls report showed that the US economy added fewer than expected jobs in March.
Friday's U.S. jobs report was firm enough to soothe concerns about U.S. recovery, but still not so strong as to hasten the end of policy stimulus.
The Bureau of Labor Statistics revealed that non-farm payrolls increased by 192,000 in March but not as much as the 200,000 expected. Payroll numbers for January and February were revised higher by a net 37,000, indicating that recent weakness in data was mostly due to the severe winter weather. The jobless rate held at 6.7% even as half a million Americans entered the workforce.
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The World Bank trimmed its 2014 growth forecast for developing East Asia but said the region's economies were likely to see steady growth in the next couple of years, helped by a pick-up in global growth and trade. The Washington-based development bank expects the developing East Asia and Pacific (EAP) region to grow 7.1% in 2014 and 2015, down from the 7.2% rate it had previously forecast for both years. Growth in 2016 is also seen at 7.1%, staying slightly below the 2013 growth rate of 7.2%.
Fitch Ratings has affirmed China's Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs) at 'A+'. The issue ratings on China's senior unsecured foreign and local currency bonds are also affirmed at 'A+'. The Outlooks on the Long-Term IDRs are Stable. The Country Ceiling is affirmed at 'A+' and the Short-Term Foreign Currency IDR at 'F1'.
Among Asian bourses, headline indices of the Japanese share market stumbled, , dragged down by tech shares following a slide on Wall Street Friday, while a strong yen hit exporters to round out a harsh day for the market. The benchmark Nikkei-225 index declined 1.69% to 14808.85, while the broader Topix index of all first-section shares fell 1.57% to 1196.84.
Japanese technology companies declined the most in the Tokyo market, following their U.S. counterparts lower. SoftBank plunged 4.6% to 7,556 yen. Rakuten Inc., an online retailer, lost 4.9% to 1,349 yen. Yahoo Japan Corp., an Internet portal-site operator, declined 5.6% to 485 yen. Otsuka slid 2.6% to 12,850 yen after Goldman Sachs cut its rating to sell from neutral.
Exporter shares slid due to yen appreciation against the US dollar. The stronger yen reduces the value of the local currency when they repatriate them home. The yen gained 0.2% versus the greenback today after rising 0.6% on April 4. Honda Motor Co. sank 2.8% to 3,571 yen. Olympus Corp., which makes endoscopes, fell 3.2% to 3,175 yen.
Daiichi Sankyo rose 3.3% to 1,813 yen following an announcement that India's Sun Pharmaceutical Industries Ltd. is taking over troubled domestic rival Ranbaxy Laboratories Ltd. from its Japanese owner, Daiichi Sankyo.
In Australia, Australian stock market finished weaker, dragged down by consumer discretionary, technology, telecom and healthcare stocks. However, fall on the downside was limited after a private sector survey indicated the domestic labour market is continuing to improve after a long soft patch. Australia's benchmark S&P/ASX200 sank 0.17% to 5413.70 while the broader All Ordinaries finished 0.23% down at 5416.10.
Job advertisements raised 1.4% m/m in March following a sharp 4.7% m/m increase in February, according to the survey report published by ANZ Banking Corp on Monday. While some of the improvement may be overstated due to seasonal adjustment challenges that typically occur in the first few months of the year, there has been a consistent improvement in labour demand across a number of different job ads/vacancies measures recently. ANZ Chief Economist (Australia) Ivan Colhoun said that there is now clearer evidence that labour demand is strengthening. Each of the main job ads/vacancies measures have risen this year, while some have been improving since the end of last year. Importantly, there has been strength in job advertising in some key industries, including construction, education and health, as well as in the most populous states of NSW and Victoria.
Consumer discretionary was the worst-performing sector in the Sydney market, down 1.2%, with media company Twenty-First Century Fox the biggest weight down 2.7% to A$34.55. Crown Resorts fell 1.4% to A$16.92 as it was reported the gambling group's Asian joint-venture Melco Crown is mulling spending $5.4 billion building a Tokyo casino in time for the 2020 Olympics.
Healthcare sector was 0.7% lower, dragged down by stem cell treatment developer Mesoblast, down 9.4% to A$4.61 on brokerage house rating downgrade. New York-based research house Eva Dimensions published a sell recommendation on Mesoblast on Friday, citing the stock, which has a high proportion of offshore shareholders, appears to have been caught up in a sell-off in the US bio-technology sector.
Shares of precious metal miners were top winner in the Sydney market today, boosted by surge in spot price by 1.3% on Friday night after the US jobs numbers trailed estimate. Australia's biggest gold producer, Newcrest Mining, lifted 3.8% to A$10.30. Gold junior Regis Resources was up 5% to A$2.23.
Wesfarmers, the conglomerate best known for its retail arm that includes Coles and Bunnings, lifted 1.2% to A$42.08 on the news it will exit the insurance business completely with the A$1 billion sale of its insurance-broking and premium-funding subsidiaries for $1 billion to global broking group, Arthur J. Gallagher. I
Aveo Group (AOG) shares finished 2% firmer today as it reaffirmed its previous guidance for FY14's underlying profit. It expects 2014 to be an improvement on last year. It is maintaining its strategy to exit its non-retirement assets. Despite recording negligible moves so far this calendar year, AGO surged by 109% in 2013.
Telstra Corporation lost 0.4% to A$5.04 after the Chief executive David Thodey forecasted mobile subscriber growth to drop off due to increased competition.
In New Zealand, Equities on the New Zealand share market fell, as investors sold tech and high-growth companies, taking advantage of recent gains to raise cash for the government's Genesis Energy sale. Xero slipped to a three month low. A2 Milk Corp and Pacific Edge paced the decline. The NZX 50 Index fell 48.061 points, or 0.9%, to 5075.840. Within the index, 29 stocks fell, 12 rose and nine were unchanged.
Xero, which has risen 220% in the past year, dropped 5.8% to NZ$35.60. A2 Corp, the milk marketer which gained 49% in the past 12 months, fell 2.3% to NZ$0.85. Bio-tech company Pacific Edge, which gained 112% last year, slid 3% to NZ$1.29.
In Hong Kong, HK stock market declined, as tepid U.S. jobs data Friday disappointed Wall Street and opened to the door to a selloff in the tech sector. The benchmark Hang Seng Index was down 0.59% to 22377.15.
Among the HK 50 blue chips, 24 fell and 22 rose, with 4 stocks remaining steady. Galaxy Entertainment Group declined 5.6% to HK$67.95, contributing 29-points losses to the benchmark Index and becoming the worst-performing blue chip. China Resources Power Holdings Co advanced 3.1% to HK$20.60, contributing 4-points gains to the benchmark Index and becoming the best-performing blue chip.
Technology stocks dropped the most in Hong Kong, following their U.S. counterparts lower. Tencent, Asia's biggest Internet company, fell 4.5% to HK$501.50.
In Indonesia, Indonesian stock market rose to its highest in 10 months ahead of elections in the country later in the week. The Jakarta Composite Index was up 1.3% to 4921.04, its highest since June 7, 2013, led by financials and market heavyweights.
Millions of Indonesians head to the polls to elect a new parliament on April 9 and a president three months later in a race that could bring major changes to the way the world's third-largest democracy are run, with the opposition PDI-P consistently topping opinion polls.
The Indonesian market has risen more than 15% so far this year, as investors hope opposition candidate Joko Widodo, the favourite to win July's presidential poll, will restart stalled reforms, making the world's fourth most-populous nation a strong contender for more investment.
Shares in Astra International gained 2.6%, while Telkom Indonesia was up 2%, boosting the overall index.
In Singapore, Singapore stocks slipped for a second straight session today, giving up on sustained selling in index linked counters amid a mostly downbeat movement in Asian equities. The benchmark Strait Times had surged towards three-month highs last week but slid under the critical 3200 levels with the correction in today's session. The index closed at 3193.60, down 19.10 points on the day or 0.60%.
Singapore's first-quarter home prices dropped for a second consecutive quarter on tighter mortgages. An index tracking private residential prices eased by 1.3% to 211.6 points in the three months ended March 31 following a 0.9% drop in the previous three-month period, according to preliminary data released by the Urban Redevelopment Authority today. The latest drop is the largest since June 2009.
Singapore GDP is likely to expand at a fractionally slower pace this year than was expected three months ago, while the core inflation rate is seen to be slightly higher, a latest central bank survey of forecasters noted. The median forecast of 22 economists surveyed by the Monetary Authority of Singapore (MAS) was for gross domestic product (GDP) to expand 3.8% this year, compared with 3.9% seen in the previous survey, released in December.
For Singapore stocks, the ST index saw 1660 million shares change hands with the value of trades placed at 901 million. The losers beat winners by 299 to 107. Golden Agri resources slumped 2.5%. Banks eased after recent gains. DBS shed 0.48% while OCBC dropped 0.31% and UOB plunged 0.70%. Wilmar international shed 0.30% while SingTel also dropped 0.82% to complete the across the board correction in local stocks.
In India, Indian stock market closed weaker, registering third straight day of retreat from record highs hit last week, on caution sparked by the start of a five-week long elections.
As per provisional figures, the S&P BSE Sensex was down 33.69 points or 0.15% to 22,325.81. The index declined 161.99 points at the day's low of 22,197.51 in afternoon trade, its lowest level since 28 March 2014. The index jumped 122.12 points at the day's high of 22,481.62 in morning trade.
Cement stocks gained on hopes of consolidation in the sector after the world's two largest cement makers, France's Lafarge and Holcim of Switzerland, agreed the terms of a merger, creating the world's biggest cement company with more than $40 billion in sales. UltraTech Cement scaled record high. Sun Pharmaceutical Industries rose while Ranbaxy Laboratories dropped after the two companies in a joint statement issued on Sunday, 6 April 2014, announced that they have entered into definitive agreements pursuant to which Sun Pharma will acquire 100% of Ranbaxy in an all-stock transaction. Shares of other pharma stocks declined.
Elsewhere in the Asia Pacific region, Malaysia's KLSE Composite rose 0.34%. Taiwan's Taiex index fell 0.14%. South Korea's KOSPI index was up 0.08%. Markets in mainland China were closed Monday for Ching Ming festival.
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