Asia Pacific Market: Treads water ahead of Christmas holiday, US fiscal cliff deadline nears

Asia Pacific share markets were tread water in thin trading on Monday, December 24, 2012, as investors across the world retreated sideline on fading hopes for a budget deal by the end of the year that would prevent the US from reaching the fiscal cliff.

The sentiment across global markets turned sour amid no sign of a breakthrough in talks between the Obama administration and the Republicans over a budget deal necessary to avoid the fiscal cliff next year. The US House Republican leaders canceled an evening vote on a tax-cut plan linked to the fiscal-cliff talks. House republicans put off a vote on a Plan B bill, which would have extended tax cuts on incomes below US$1mn, saying they did not have the votes to pass.

 

Top U.S. lawmakers voiced rising fear on Sunday that the country would go over the fiscal cliff in nine days, triggering harsh spending cuts and tax hikes, and some Republicans charged that was President Barack Obama's goal.

Turnover across the regional bourses were light as many investors retreated on the sideline amidst fading hopes for a budget deal by the end of the year that would prevent the US from reaching the fiscal cliff. Meanwhile early closing of the key regional bourse also trimmed on volume. Stock markets in Australia, New Zealand, Hong Kong, Singapore closed early Monday for Christmas Eve, meanwhile Japan and Indonesia share markets were closed today for a public holiday.

In the Asia Pacific Market, Australian shares closed shortened session slight higher, lifted by blue-chips. The benchmark S&P/ASX 200 index ended 11.6 points higher at 4,635.2 in thin trade. Shares in surf wear company Billabong International ended 0.6% higher after the takeover target said it had allowed the backers of a A$556 million buyout offer to examine its books. Department store Myer gained 1%on hopes of strong holiday sales.

New Zealand's benchmark NZX 50 index closed shortened pre-Christmas session up 0.07% at 4,057.8. Hallenstein Glasson Holdings lead some retailers higher after figures showed seasonal sales are tracking ahead of last year. Metlifecare fell after joining the benchmark index.

South Korea's benchmark Korea Composite Stock Price Index closed edged 1.40 points higher at 1,981.8, helped by gained in blue chip Samsung Electronics after a brokerage upgraded its target share price, forecasting strong smartphone sales next year. Hyundia Heavy Industries declined 1.6% after announcing on Sunday that the company and its affiliated shipyard have obtained orders totaling $1.05 billion to build five liquefied natural gas (LNG) carriers.

China's benchmark Shanghai Composite Index closed up 0.2% to 2,159 points, outshining the region, helped by strength in financials after state-run media reported of more fund allocation by the country's social security funds and raised expectations of additional investment in the sector. Chinese banks rallied, with China Merchants Bank gaining 3.3% and Agricultural Bank of China rising 0.7% in Shanghai. Alcohol stocks extended their November downward spiral as Kweichow Moutai fell 4.7% after Beijing banned its top brass from hosting boozy banquets while working.

Hong Kong's shares closed holiday-shortened session edge higher, pushing the benchmark Hang Seng Index up 0.2% at 22,541.2, with Chinese lender led rally. Among the 50 blue chips, 23 stocks rose and 24 fell, while remaining 3 unchanged. Cathay Pacific gained 1.4% to HK$14.22 while COSCO Pacific dropped 1% to HK$11.38, making themselves the largest blue-chip gainer and loser respectively. Market heavyweights were mixed. China Mobile dipped 0.5% to HK$89.7, while HSBC edged up 0.7% to HK$81. China Gogreen Assets jumped 12.5% to HK$0.054 after its announced a proposed acquisition of solar energy projects.

India's shares closed choppy session slight higher, with the BSE Sensex Index finished 13.09 points or 0.07%, higher at 19,255.09, led by gains in Tata Motors that extended its recent rally on hopes of improved sales at its key unit Jaguar Land Rover and as short-covering helped gains in technology shares such as Infosys. Index heavyweight Reliance Industries (RIL) edged lower. Index heavyweight and cigarette maker ITC was slightly lower.

Elsewhere, Singapore's Straits Times Index closed up 0.2% while Malaysia's KL Composite Index ended 0.07% lower and Taiwan's Taiex index was edge 0.06% lower.

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