Asia Pacific share market ended down on Thursday, 29 October 2015, as risk sentiments weighed down after the Federal Reserve signals a December rate hike still on the table.
At the conclusion of its two-day policy meeting, the Federal Reserve kept interest rates unchanged at 0-0.25% but signaled that it would assess whether the U.S. economy had strengthened enough to warrant higher interest rates at its December meeting. Investors were looking ahead to revised U.S. economic growth data, as well as the weekly report on jobless claims due later in the day, for further indications on the strength of the economy.
RBNZ kept official cash rate unchanged at 2.75% as widely expected. The central bank maintained easing bias and noted that "some further reduction in the OCR seems likely".
Investors are speculating that the Bank of Japan could also expand its easing steps to keep economic recovery on track, but unexpectedly strong industrial output data on Thursday reduced the chance of the BOJ acting at its meeting on Friday.
Preliminary industrial production data released by the Ministry of Economy, Trade and Industry on Thursday, showing Japan's industrial production unexpectedly rose 1% on the month in September, coming in stronger than the median economist forecast of 0.5% decline. It was the first increase in three months after drop of 1.2% in August and drop of 0.8% in July. METI revised up its assessment of production from the previous month, saying it is "fluctuating." It was the first upgrade since December 2014.
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Among Asian bourses
Australia market falls for fourth day in row
The Australian share market ended lower for fourth consecutive session, as risk sentiments hammered after the U.S. Federal Reserve signaled the possibility of a December rate hike. All ASX industry groups bar utilities declined, with shares of bullion miner, resources, energy, and consumer goods issues being major losers. The benchmark S&P/ASX 200 index declined 68.30 points, or 1.28%, to 5266.90 points, while the broader All Ordinaries index sank 64.20 points, or 1.19%, to 5310.20 points.
Consumer staples issue was worst performer on the day, with Woolworths falling 9.8% to A$24.70 after warning that net profits will fall as much as 35% in the December half to between A$900 million and A$1 billion. Same-store Australian food and liquor sales fell for the second consecutive quarter, down 1% in September quarter after a 0.9% drop in the June quarter, as Woolworths struggled to reverse customer perceptions that its prices are higher than Coles. Fears of continuing price wars in the grocery sector resulted in competitor Wesfarmers dropping 4.3% to A$40.18, while Metcash was walloped even worse than Woolworths, losing 10.4% to A$1.20.
The banks and financial stocks were also ended lower, with ANZ Banking Group falling 2% to A$28.17 after reporting record full-year profits of A$7.2 billion, but also slowing earnings growth, flat dividends. Commonwealth Bank shed 0.6% to A$77.17 and National Australia Bank declined 4% to A$30.46 but Westpac performed relatively well, finishing flat at A$31.92.
Material and resources stocks declined on tracking fall in iron ore prices. Iron ore price slumped by 3% to $49.95 per tonne overnight. BHP Billiton weakened 1.3% to A$23.47 and Rio Tinto slipped 1.8% to A$51.14. Junior iron ore miner Fortescue sank 2.2% to A$2.20
Blackmores surged 12.9% to A$175.51 after news it was expanding beyond its core business to enter the infant formula market through a partnership deal with dairy group Bega Cheese.
Nikkei ends higher in cautious trade
The Japanese share market ended higher in cautious trade, on the back of upbeat factory output data for September and sign of further recovery of industry production in October. But, market gain was limited on caution ahead of Bank of Japan a one-day policy meeting on Friday. Total 18 out of 33 TSE first-section sector sub-indexes ended higher, with gainers were led by Precision Instruments, Pharmaceutical, Machinery, Wholesale Trade, and Mining issues. The Nikkei Stock Average rose 32.69 points, or 0.17%, to end at 18935.71 points. The broader Topix index eased 0.01%, or 0.08 point, to 1547.11 at the close.
Machinery stocks were higher, with machine tool builder Okuma leading rally, up 9.2%, after it raised its profit outlook for the year ending March and hiked dividend payout. Komatsu advanced 1.8%.
Shares of securities firms declined the most in Tokyo market, after softer than expected earnings for the third quarter. Nomura Holdings and Daiwa Securities plunged nearly 3% each.
Nintendo skidded 9% after the game maker pushed back the much-awaited launch of its videogame service for smartphones to March 2016 from the end of this year. Mobile-internet firm DeNA Co, Nintendo's partner on the project, was also ended down 15%.
China stocks end mixed
The Mainland China stocks ended mixed in cautious trade, as traders eyed ongoing weakness in manufacturing and disappointing third quarter results from the financial sector. The Shanghai Composite Index rose 0.36%, or 12.12 points, to close at 3387.32 points. The Shenzhen Composite Index, which tracks stocks on China's second exchange, grew 0.8%, or 16.02 points, to 2014.40. The ChiNext Index, which tracks China's NASDAQ-style board of growth enterprises, edged up 0.04 point to close at 2485.28.
The Communist Party is due to end a four-day plenum for its central committee Thursday, and may release a general outline of the social and economic development plan for the next five years. Premier Li Keqiang highlighted a minimum growth estimate for China in the coming five years that could indicate the leadership's readiness to accept the weakest period of expansion since the economy was opened up three decades ago.
Shares of drug and consumer-staples companies advanced the most in Beijing. Luzhou Laojiao Co. advanced 3.5% after reporting a 6% gain in third-quarter net income. Jiangsu Hengrui Medicine Co. surged 3.1%.
Shares of finance companies were weaker, as poor third quarter earnings continued to roll in. China Life Insurance Co. sank 5.4% after reporting a 74% slide in net income on plunging investment income and rising claims. . Bank of China, Bank of Communications and Industrial and Commercial Bank of China (ICBC) eased between 0.4 and 0.8%.
Hong Kong market falls 0.6%
Hong Kong stock market declined, as sentiments weighed down after the Federal Reserve signals a December rate hike still on the table. The benchmark Hang Seng Index declined 136.63 points, or 0.6%, to 22819.94 points. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, fell 119.09 points, or 1.13%, to 10439.38 points. Turnover increased to HK$70.7 billion from HK$61 billion on Wednesday.
China Life (02628) slid 5% to HK$28.7 after reporting a 74% decline in its quarterly earnings. It was the worst blue chip loser today. NCI (01336) also sank 5% to HK$34.05 ahead of its earnings report tomorrow. Ping An (02318) fell 1% to HK$43.6.
CNOOC (00883) was the blue-chip star, rising 3% to HK$8.86, in tandem with rising crude prices. The company said its 3Q output grew 23.8% and benefited from a slew of investment banks' positive comments. PetroChina (00857) and Kunlun Energy (00135) also put on 1% and 2% to HK$6.19 and HK$6.46.
GOME Electrical Appliances was up 12.1% to HK$1.48 after the retailer said it will be buying 578 stores from its controlling shareholder at a discount of 20%.
Local developers were weaker as the Fed is seen to raise rate as earliest as December. CK Property (01113) fell 2% to HK$55. Henderson Land (00012) and New World Development (00017) slipped 1.4% and HK$1.3% to HK$50.45 and HK$8.36.
Sensex slips for 4th consecutive trading session
Stocks of state-run companies, banking shares and index heavyweights ITC, L&T and Infosys led losses for key benchmark indices, with the barometer index, the S&P BSE Sensex, falling below the psychological 27,000 mark. The Sensex fell 201.62 points or 0.75% to settle at 26,838.14. The 50-unit CNX Nifty fell 59.45 points or 0.73% to settle at 8,111.75. The latest slide for Indian stocks was triggered by increased possibility of an interest-rate hike from the US Federal Reserve at its next policy meeting in December 2015.
Cipla fell 0.64% to Rs 691.10. The company has entered into a definitive agreement to sell its entire remaining 25% stake in Biomab Holding Limited, Hong Kong (BHL) to Biomab Brilliant Limited, British Virgin Islands for a total consideration of $25.77 million. BHL is focused on developing Biosimilars for the Chinese market. Cipla said that the decision to divest its entire remaining stake in Hong Kong based BHL was taken with a view to focus on global product development of Biosimilars in the field of cancer, auto-immune diseases, respiratory diseases and diabetes.
Dr Reddy's Laboratories rose 2.59% to Rs 4,214.05. On a consolidated basis, the company's net profit rose 25.74% to Rs 721.89 crore on 11.25% increase in total income to Rs 4020.95 crore in Q2 September 2015 over Q2 September 2014. The result was announced after market hours today, 29 October 2015.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index declined 1.1% to 8571. South Korea's KOPSI fell 0.4% to 2034.16. Singapore's Straits Times index slipped 1.3% at 3001.51. Indonesia's Jakarta Composite index sank 3% to 4472. Malaysia's KLCI fell 1.2% to 1667. New Zealand's NZX50 rose 0.1% to 6003.
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