Asia Pacific Market: Stocks closed mostly lower

Asia pacific share market closed down on Wednesday, 19 November 2014, as investors continued booking profit on caution before the release of flash China's manufacturing for this month tomorrow and minutes of the U.S. Fed's policy meeting due later this week.

HSBC Holdings Plc and Markit Economics are due to release a preliminary index of China's manufacturing for November tomorrow.

The minutes of FOMC are expected to shed light on the central bank's thinking following the end of quantitative easing. Investors will look for any insight into why the words "considerable time" were retained in reference to the period before a rate hike.

 

The statement from the October meeting was moderately hawkish and the minutes will elaborate inflation expectations, impact of energy prices, forward guidance language and diminishing underutilisation of labour resources.

Among Asian bourses

Aussie market falls 0.24%

Australian share market closed down for third straight day on Wednesday, 19 November 2014, due to mounting worries about weakness in commodity prices and its consequences on the domestic economy. Almost all sectoral indices dived into sea of red, exception being bullion, utilities and healthcare, with shares in consumer staples, energy, material, realty and financial companies being major decliners. The benchmark S&P/ASX 200 Index was down 30.90 points, or 0.57%, to 5368.80 and the broader All Ordinaries Index fell by 30.60 points, or 0.57%, to 5352.50.

Shares of materials and resources companies extended fall after iron ore prices dropped to a fresh five-year low. Iron ore miners tumbled after the spot price for iron ore, delivered in China, lost 4.4% to $US71.80 a tonne on Tuesday. BC Iron was the worst-performing stock in the ASX 200, sinking 12.2% to A$0.575, its lowest point this year. Resources giant BHP fell 1.5% to A$32.67 while main rival Rio Tinto down 2.5% to A$57.98. Fortescue shares dropped 7.7% to A$2.74.

Equities of the energy producers closed down inline with drop in crude oil prices. Santos declined 1.7% to A$11.65, while Beach Energy shed 2.9% to A$1.02. Australia's biggest oil producer Woodside Petroleum fell 1.1% to A$38.41 as it confirmed plans to developed its Browse gas fields off the Kimberley coast.

Retailers were also weaker, with Woolworths down 2.2% to A$32.26, a day after UBS analyst Ben Gilbert cut his recommendation from "buy" to "sell". Wesfarmers, owner of Coles, slipped 1.8% to $42.89.

Orica lost 4.1% to A$18.47 after the company said it will slash around 700 jobs as it showed a $602.5 million annual profit and announced the sale of its non-mining chemicals division to private equity giant Blackstone for A$750 million.

Nikkei drops 0.3% on profit taking

Japanese share market closed weaker in volatile trade, as traders sought to cash in gains following recent sharp gains after Prime Minister Shinzo Abe called for an early election for fresh mandate for his Abenomics that include postponing the scheduled sales tax hike. The Nikkei Stock Average ended down 0.3% at 17288.75 following Tuesday's 2.2% rise.

Shares of Terumo lost 4.8% after medical device maker offered Y100 billion worth of zero-coupon convertible bonds for overseas investors, excluding the U.S. The terms of the paper imply a dilution rate of approximately 6.8%.

Shares of JGC Corp slipped 2.7% after an SMBC Nikko Securities downgrade its rating for petroleum engineering firm to hold from outperform, citing uncertainties in operating conditions amid sharp drops in crude oil prices. The brokerage also cut its price target to Y2,900 from Y3,700.

Shares of Tokio Marine Holdings gained 4.1% after the casualty insurer revised up its full fiscal year consolidated net profit forecast to a record Y270 billion.

Shanghai Composite falls 0.22%

Mainland China share market closed down for fifth consecutive session, as fading enthusiasm over the linkup between the Shanghai and Hong Kong stock exchanges and on caution before release of flash China's manufacturing for this month tomorrow. The Shanghai Composite Index fell 0.71%, or 17.64 points, to 2456.37 at the close.

Officials have trumpeted the Shanghai-Hong Kong Stock Connect as opening up the Chinese mainland's stock market to the outside world and offering mainlanders entry to the Hong Kong exchange. But the launch day was disappointing. While Hong Kong investors had exhausted their daily allowance of Shanghai shares two hours before the end of trade, mainlanders used up under 20% of their quota by the close.

The second day of trading also proved a damp squib, with mainland investors buying 7.6% of their daily allowance of Hong Kong shares, while Hong Kong dealers picked up less than a third of their Shanghai quota. On the third day (today), international investors bought about 2.6 billion yuan ($424.7 million) of Shanghai shares out of the maximum daily 13 billion yuan permitted under the link today, while mainland investors left unused 97% of their quota to buy Hong Kong stocks.

Shares of Huayi Brothers (300027) Media Corp., China's biggest listed film maker, jumped by the 10% daily limit after selling new shares to investors. The company said it plans to sell 145 million shares to four investors including Jack Ma and Shenzhen Tencent Computer System.

Hang Seng falls 0.66%

Hong Kong share market closed down for third consecutive session, on fading excitement over the much-vaunted trading link up with Shanghai's exchange. The Hang Seng Index ended down 155.86 points to 23373.31, off an intra-day high of 23341.16 and low of 23572.21. Turnover fell to HK$65.12 billion from HK$74.60 billion on Tuesday.

Mainlander interest in the city's shares was virtually non-existent on the third day of the much-vaunted trading link up with Shanghai's exchange. International investors bought about 2.6 billion yuan ($424.7 million) of Shanghai shares out of the maximum daily 13 billion yuan permitted under the link today, while mainland investors left unused 97% of their quota to buy Hong Kong stocks.

Bourse operator Hong Kong Exchanges and Clearing dipped 3.4% to HK$168. It was the biggest blue chip loser, and has declined for four consecutive trading days, losing a total of 10.2%.

Ten blue chips bucked the downward trend. China Unicom (00762) added 1% to HK$11.22. China Merchants (00144) edged up 0.8% to HK$25.9. AIA (01299) nudged up 0.7% to HK$44.05.

Sa Sa (00178) put on 2% to HK$5.67 after the cosmetic products retailer announced its earnings. Research houses issued mixed reports on its performance.

Sensex, Nifty hit lowest closing level in almost a week

Indian stock market closed down on heavy selling in metal, power and PSU sector stocks amid weak global cues. The S&P BSE Sensex declined 130.44 points or 0.46% to settle at 28,032.85, its lowest closing level since 13 November 2014. The CNX Nifty shed 43.60 points or 0.52% to settle at 8,382.30.

Foreign institutional investors sold Indian shares worth 1.02 billion rupees ($16.5 million) on Tuesday, marking their first sale since Oct. 28.

IT stocks advanced on weak rupee. Capital goods stocks edged lower. Bank stocks fell across the board. Metal and mining stocks declined. Cement stocks also edged lower.

Elsewhere in the Asia Pacific region: Taiwan's Taiex index rose 1.18% to 8963.24. South Korea KOSPI was marginal 0.01% down at 1966.87. New Zealand's NZX50 added 0.31% to 5522.06. Singapore's Straits Times index rose 0.63% at 3334.56. Malaysia's KLCI rose 0.33% to 1824.39. Indonesia's Jakarta Composite index jumped 0.5% to 5127.93 after Bank Indonesia raised key interest rates by 25 basis points to 7.75 percent a day after the government raised price of subsidized fuel by more than 30 percent.

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