The Federal Reserve is due to release the minutes of the two-day policy meeting held on 28-29 July 2015 on Wednesday, 19 August 2015. The minutes could offer some clues on the timing of the Fed's plans to raise interest rates for the first time in a decade.
Among Asian bourses
Nikkei bounces on stimulus hopes
Japanese share market advanced on first trading session of the week on bolstering speculation of further stimulus measures from the government after softer than expected Japan growth data. 28 out of 33 TSE sectors ended above neutral line, with Textiles & Apparels, Foods, Rubber Products, Glass & Ceramics Products, and Construction sectors being top gainers. The Nikkei Stock Average advanced 100.81 points, or 0.49%, to end at 20620.26 points. The broader Topix index ended 8.41 points, or 0.51%, lower at 1672.87 points.
Japan's gross domestic product shrank 1.6% on an annualized basis in the April-June quarter, according to data released on Monday by the Cabinet Office. On a quarter-on-quarter basis, GDP contracted 0.4% in April-June quarter. Consumption, which accounts for about 60% of Japan's GDP, dropped a real 0.8% on quarterly basis as consumer sentiment was dampened by rising prices of food and daily necessities, as well as unstable weather conditions in the reporting period. Exports declined 4.4%, marking the first contraction in six quarters due to sluggish shipments of electronics devices amid slowing growth in some emerging economies and imports also saw a decline of 2.6%. Corporate capital spending, which the government sees as the key to shoring up the economy, fell 0.1% for the first decline in three quarters.
Shares of energy-related companies led declines on the TSE, as oil prices declined further during Asian trading on Monday, with New York Mercantile Exchange light, sweet crude futures for delivery in September slipping below US$42 a barrel while October Brent on London's ICE Futures exchange fell by US$0.64 to US$48.55/barrel. Inpex lost 0.7%, while offshore contractor Japan Drilling Co. lost 1.4%. Japan Petroleum Exploration Co. slipped 1.2%.
Shionogi & Co. climbed 3.1% after Mizuho Financial Group Inc. raised its share-price target on the drugmaker by about 40% to 6,500 yen.
Digital Garage Inc. jumped 6.1% after the web service provider's posted better than expected 84% gain in operating profit to 4.18 billion yen.
Sompo Japan Nipponkoa Holdings Inc. added 1.5% after a report the insurer will raise premiums for the first time in eight years.
SoftBank Group Corp fell 1.1% after Soros Fund Management, led by George Soros, sold off most of its stake in Chinese internet retailer Alibaba Group Holding.
Australia market bounces 0.2%
The Australian share market ended modest higher, as gains in bullion, utilities, financials, industrials and healthcare blue chip stocks were more than offset by losses in technology, energy, materials and retailers stocks. The benchmark S&P/ASX 200 Index advanced 11.20 points, or 0.21%, to 5367.70 points, while the broader All Ordinaries Index grew 8.60 points, or 0.16%, to 5368.60 points. Volume was slightly below average with 1.9 million transactions valued at A$4.7 billion. 433 companies ended the day higher while 489 closed lower and 355 were unchanged.
Shares of financial sector were higher, with top lenders all improved, exception being the Commonwealth Bank (CBA), which fell 1% to A$81.27 as it returned from a trading halt today after completing the institutional portion of its capital raising. CBA has raised A$2.1 billion from institutional shareholders after completing the first part of its A$5 billion renounceable entitlement offer. Eligible shareholders may purchase one new share for every 23 shares already held, at a discounted offer price of A$71.50 per share. The offer for retail investors will open on 24 August and close on 8 September. Among other top lenders, National Australia Bank added 1.6% to A$32.26, Australia and New Zealand Banking Group rose 0.8% to A$29.52, and Westpac Bank jumped 2% to A$31.94.
Shares of energy sector were main drag on the market, retreating by 0.94%, as oil prices declined further during Asian trading on Monday, with New York Mercantile Exchange light, sweet crude futures for delivery in September slipping below US$42 a barrel while October Brent on London's ICE Futures exchange fell by US$0.64 to US$48.55/barrel. Woodside Petroleum (WPL) dropped 0.8% to A$32.59. Origin Energy de-grew 1.1% to A$9.56 and Oil Search lost 2.2% to A$6.55. Santos (STO) dipped 0.2% to A$5.98 as it tried to diffuse market speculation around the prospect of a capital raising.
Materials and resources stocks also ended mixed, with BHP Billiton falling 0.5% to A$25.20 and Rio Tinto sinking 0.5% to A$50.89, while Fortescue Metal rose 3.1% to A$1.84. Newcrest Mining gained 4.5% to A$11.44 after it reported a return to profitability following years marked by huge asset writedowns, moving it closer to resuming dividend payments.
Aurizon Holdings (AZJ) shares ended the session at A$5.24, a gain of 3.5%, after the freight operator reported an underlying full year net profit after tax (NPAT) of A$604m, up 15% when compared to the previous year. Revenue of A$3.78bn in FY15 was up 1% with underlying earnings before interest and tax (EBIT) up 14% to A$970m.
China stocks ends higher
Mainland China's stock market ended higher in volatile trading session, as the yuan steadied after the China's central bank held a rare press conference late last week to quell concerns of currency volatility. 9 out of 10 SSE sectors ended well above the neutral line, with shares of healthcare, materials, utilities, consumer staples, and consumer discretionary sectors being top gainers. After ending morning trade in the red, the benchmark Shanghai Composite Index closed up 0.71%, or 28.33 points, to 3993.67 points. The Shenzhen Composite Index, which tracks stocks on China's second exchange, grew 0.74%, or 17.09 points, to 2327.49 points. Total volume of A shares traded in Shanghai was 62.63 billion shares, while Shenzhen volume was 32.68 billion shares.
The Chinese currency was little changed Monday at 6.3945 per dollar as the People's Bank of China helped stabilize the exchange rate, after sliding 2.9% last week. Traders said the stablisation of the yuan was mainly market-driven, and they have not seen any signs that major state-owned banks are intervening in spot rates during the session as happened last week.
Shares of civil aviation climbed up sharply, with China Eastern Airlines Corp surging 10% daily limit after the nation's second-largest carrier posted 300 fold rises in a first-half net income. Air China climbed 8.7% and China Southern Airlines Co gained 9.7%.
Property developers' shares were mostly down ahead of the release of July home price data on Tuesday. Poly Real Estate added 1.4% while China Vanke slipped 1.3% and Gemdale Corp fell 0.7%.
Shares of Tianjin port operator declined after blasts at a chemical warehouse in Tianjin. Tianjin is the world's 10th-busiest port and has become a gateway to northern China for shipments of metal ore, coal, autos and crude oil. Tianjin Port Development Holdings sank 13%. Tianjin Development Holdings tumbled 3.2%.
Hong Kong market ends softer
Hong Kong stock market declined to eight month low, on concerns China's devaluation of the yuan could hurt local companies. Selloff momentum accelerated after reports indicated foreigners were withdrawing funds amid concern about the weaker outlook for the yuan and Chinese economic growth. The Hang Seng Index ended down 176.38 points, or 0.74%, at 23814.65 points. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, lost 97.82 points, or 0.88%, to 10962.24 points. Turnover increased to HK$65.8 billion from HK$64.2 billion on last Friday.
Risk sentiments were hit by concerns the cheaper yuan will affect local companies after China cut the value of its daily reference rate against the US dollar by a record 4.4% last week.
China International Capital Corp. said today that net outflows from Chinese and Hong Kong equities reached $531 million in the week to Aug. 12, the ninth week of sales out of the past 10. Over the past 2 1/2 months, about $8.8 billion has flowed out of China and Hong Kong-focused global funds, CICC said in a note Monday, citing EPFR Global.
Chinese insurers dipped on worries of massive explosion in Tianjin may trigger claims. PICC P&C (02328) fell 2% to HK$16.16. China Taiping (00966) retreated 3% to HK$22.35. China Life (02628) slid 2% to HK$28.3.
Shares in Tianjin Port sank 13% to $HK1.40, their biggest loss since 2009, as fears mounted that hundreds of tonnes of cyanide released by deadly blasts last week could hamper shipments long-term.
Property companies with high amounts of US dollar debt, now more expensive to service, were hurt, including top developer Vanke, which fell 3.09% to $HK18.18 despite reporting a pickup in first-half earnings.
Shares of property companies declined amid concerns yuan devaluation likely turns high amounts of US dollar debt, which would more expensive to service. Developer China Vanke fell 3.09% to $HK18.18 despite reporting a pickup in first-half earnings.
Sensex snaps 2-day winning streak
Indian benchmark indices edged lower, with oil stocks leading losses. The barometer index, the S&P BSE Sensex, fell below the psychological 28,000 level. The Sensex lost 189.04 points or 0.67% to settle at 27,878.27.
Shares of public sector banks (PSU banks) edged higher after the government after trading hours on Friday, 14 August 2015, announced a revamp plan for PSU banks. Shares of private sector banks edged lower. Tata Motors edged higher amid volatility after the company reported weak global wholesales in July 2015. Shares of upstream oil exploration and production (E&P) firms edged lower as global crude oil prices fell. Shares of public sector oil marketing companies (PSU OMCs) dropped after announcing reduction in petrol and diesel prices.
Foreign portfolio investors (FPIs) bought Indian shares worth a net Rs 461.46 crore from the secondary equity market during the previous trading session on Friday, 14 August 2015, as per data from National Securities Depository (NSDL). Domestic institutional investors (DIIs) bought shares worth a net Rs 179.20 crore on Friday, 14 August 2015, as per provisional data released by the stock exchanges.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index fell 1.1% to 8213.42. South Korea's KOPSI declined 0.8% to 1968.52. New Zealand's NZX50 rose 0.5% to 5727.42. Singapore's Straits Times index shed 1.5% at 3067.35. Malaysia's KLCI dropped 1.5% to 1572.54.
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