Asia Pacific share market declined on Thursday, 11 December 2014, as falling oil prices reinforced jitters about a sluggish global economy.
Oil was slightly higher today after tumbling to fresh five-year low on Wednesday, dragged down by a surprise inventories increase and news the Organization of the Petroleum Exporting Countries cut its 2015 demand expectations for crude.
The benchmark U.S. crude was up 59 cents at $61.53 a barrel in electronic trading on the New York Mercantile Exchange on Thursday. The contract dived $2.88 to close at $60.94 a barrel on Wednesday. The price of oil has now dropped more than 40% from a peak of $107 in June because of weak demand and oversupply.
The U.S. Energy Information Administration said Wednesday oil inventories rose by 1.5 million barrels in the week ending Dec. 5. The EIA also said gasoline supplies rose by 8.2 million barrels, and supplies of distillates, which include heating oil, rose by 5.6 million barrels.
An OPEC report has projected that demand for its crude would sink next year to levels not seen in more than a decade. It predicts that demand for OPEC oil would drop to 28.9 million barrels a day next year, compared with 29.4 million barrels a day in 2014. In its latest monthly report, OPEC said crude production from member countries declined by 390,100 barrels a day to 30.05 million barrels a day in November, compared with October.
Among Asian bourses
Aussie stocks fall for third day
Australian share market closed lower for third consecutive day, due to sharp falls in resources companies caused by further weakness in commodity prices. However, rally in Telstra shares and better-than-expected jobs data helped the local share market to trim more than halve early losses. The benchmark S&P/ASX 200 index declined 28 points, or 0.53%, to close at 5231 and the broader All Ordinaries index lost 29.70 points, or 0.57%, to 5207.40. Market turnover was relatively moderate, with 1.22 billion shares changed hands worth of A$3.48 billion. 401 stocks were up, while 829 were down.
The Australian Bureau of Statistics said on Thursday that Australia's unemployment rate rose slightly, to 6.3%, in November. The number of people employed rose by 42700 to 11.64 million in November, compared with a revised 13700 in October.
Shares of energy companies declined heavily after crude oil prices hit new five year lows overnight. Santos was one of the worst performers, down 8.3% to A$7.00 as it announced a 25% cut in capital expenditure in 2015. Woodside Petroleum dropped 2% to A$34.19 and Oil Search shed 2.9% to A$7.04.
Shares on mining companies also declined, with Resources giant BHP Billiton falling 1.3% to A$29.00, while Rio Tinto fell 2.4% to A$55.04 and Fortescue Metals was 3.5% weaker at A$2.47.
Bucking the trend, bullion miner Newcrest Mining jumped 3.4% to A$10.85 and small iron ore producer BC Iron rose 1.3% to A$0.40 after the company lowered its cash cost guidance from the remainder of the financial year to between A$54 and A$61 per tonne.
Caltex added 2.9% to A$31.26 after it flagged a rise in full year profit of up to 40%. Telstra gained 1.3% to A$5.69.
Nikkei falls for third day on profit booking
Japanese stock market closed down for third straight day, as profit booking continued on recently overbought shares after yen appreciated to 118-level against greenback and Fitch Ratings warning on Japan's sovereign credit. The benchmark Nikkei Stock Average declined 155.18 points, or 0.89%, to 17257.40.
The market mood remained on the risk averse due to yen appreciation against major rivals. In Asia trade today, the U.S. dollar ended trading session at 118.15 yen after briefly dipping to 117.44 yen. Just three days prior, it fetched nearly 122 yen. A weaker dollar is bad for exporters, as they have less latitude to cut prices on goods they sell overseas, and don't earn as much yen when then repatriate the profits back home.
Shares of oil explorer declined the most in Tokyo after oil prices dropped to a five-year low. Oil explorer Inpex Corp. lost 1.1% to 1231 yen and energy-services provider JGC Corp. fell 2.2% to 2492.5 yen.
Currency sensitive stocks declined, with Honda sliding 1.2% to 3,568 yen. Endoscope-maker Olympus Corp., which gets more than 75% of its revenue internationally, retreated 1.8% to 4,290 yen.
Financial stocks also retreated, with Sumitomo Mitsui sliding 1.7% to 4,317 yen. Mitsubishi UFJ Financial Group Inc. declined 1.5% to 670 yen and Mizuho Financial Group Inc. dropped 0.7% to 203.6 yen.
Airline stocks surged on expectation the industry is set to benefit from the lower oil prices. ANA rose 1.5% to 300.4 yen while Japan Airlines advanced 3.2% to 3,840 yen. Skymark soared 13% to 305 yen, adding to a 17% increase yesterday, after President Shinichi Nishikubo told reporters the carrier is discussing a share sale with four investment funds and will choose one.
Shanghai Composite falls 0.5% on liquidity woes
Mainland China share market closed down in volatile trading, due profit booking in overbought stocks amid concern recent gains were excessive. Meanwhile, worries over market liquidity after a slew of new listings approval also weighed on stocks. The benchmark Shanghai Composite slid 0.5% to 2925.74 at the close, after gaining as much as 0.9% and falling as much as 1.6%.
Investors were worried over market liquidity after China's securities regulator approved ahead of schedule 12 IPOs late on Wednesday, a move which could cool a blistering rally in the country's stock markets.
Financial stocks declined the most in Shanghai, dragged down on profit booking following sharp recent gains. Brokerages have rallied as new stock account openings jumped to five-year highs and traders increased the use of leverage to buy stocks. The decline was led by brokerages, with Founder Securities Co locked 10% lower circuit at 13.64 yuan and Western Securities Co declined 10% daily limit at 30.51 yuan
Shares of energy companies declined heavily after crude oil prices hit new five year lows overnight. PetroChina fell 2.2% to 9.29 yuan and China Petroleum & Chemical Corp lost 2% to 5.76 yuan. China Oilfield Services slumped 2.4% to 18.71 yuan after saying it expects revenue and operating profit for 2015 will drop from this year.
Airline stocks surged on expectation the industry is set to benefit from the lower oil prices. Air China gained 10% daily limit to 6.96 yuan and China Southern Airlines Co rose 9.9% to 5.54 yuan.
Hang Seng drops 211.98 points
Hong Kong share market closed down, discouraged by weakness in the mainland A-share market and weak finish of Wall Street overnight. Most of the blue chips declined with energy, financial and realty players being major losers. The Hang Seng Index ended lower 211.98 points, or 0.9%, to 23312.54, off an intra-day high of 23382.83 and low of 23169.67. Turnover decreased to HK$98.08 billion from HK$109.93 billion on Wednesday.
Oil majors continued to be pressured on oil prices drop. Sinopec (00386) and PetroChina (00857) slid 1.13% and 1.1% to HK$6.1 and HK$8.07. CNOOC (00883) declined 1.57% to HK$10.06. Kunlun Energy (00135) plunged 3.48% and HK$6.93.
Airlines bucked the trend, surging on expectation the industry is set to benefit from the lower oil prices. Cathay Pacific (00293) put on 1.97% to HK$17.58. South China Air (01055) and Air China (00753) shot up 4.32% and 5.36% to HK$3.86 and HK$6.49.
Kaisa (01638) plummeted 10.73% to HK$2.08 after its chairman tendered resignation due to health reasons.
Sensex ends below 27600, Nifty below 8300
Indian marketended lower as investors trimmed positions in equities after declining crude oil prices raised concerns of slowdown in global growth. The Sensex provisionally ended 229 points down at 27,592 and the Nifty ended down 62 points at 8,294. Shares of export oriented pharma firms advanced on weak rupee. Cement shares declined.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index fell 0.21% to 9013.07. South Korea KOSPI was down 1.5% to 1916.59. New Zealand's NZX50 was down 0.4% at 5502. Singapore's Straits Times index fell 0.2% at 3318.70. Indonesia's Jakarta Composite index shed 0.25% to 5152.69. Malaysia's KLCI dropped 1.2% to 1744.57.
Powered by Capital Market - Live News
