Asia Pacific share market mostly advanced on Wednesday, 25 February
2015, on taking their cues from Wall Street's gains overnight triggered
by Federal Reserve Chair Janet Yellen's testimony to the Congress which
was perceived as dovish by investors. Meanwhile, investor sentiment also
received a boost from relief over a Greek debt deal and a
better-than-expected HSBC flash PMI from China.
The US Federal Reserve Chairwoman Janet Yellen reassured investors with her testimony before Congress that the US labour market still showed some weakness and inflation continued to fall, making any interest rate hike unlikely before June.
Euro-zone finance ministers approved a four-month bailout extension for Greece on Tuesday after the government pledged to revamp tax collection, consolidate pension funds and maintain sales of state-owned assets. The accord paves the way for the European Central Bank to continue support of Greek lenders, while buying time for the euro area's most indebted state to convince creditors it will deliver.
The preliminary HSBC China Manufacturing Purchasing Managers' Index, a gauge of nationwide manufacturing activity, rose to 50.1 in February compared with a final reading of 49.7 in January, HSBC Holdings PLC said on Wednesday. A reading below 50 indicates a contraction in manufacturing activity from the previous month, whereas a reading above indicates expansion. "Today's flash manufacturing PMI data point to a marginal improvement in the Chinese manufacturing sector going into the Chinese New Year period in February," HSBC's chief economist for China, Qu Hongbin, said in a statement.
Among Asian bourses
Australia stocks up for third straight day
The Australian share market advanced for third straight day, as a positive lead from the Wall Street overnight helping to overcome a bit of earnings-related weakness. The benchmark S&P/ASX 200 Index rose 0.3% to 5944.90 points, its highest close since May 2008, while the broader All Ordinaries Index was up 0.32% to 5908.60 points. Market turnover was relatively healthy, with 1.78 billion shares changing hands worth of A$5.25 billion. Total of 774 stocks were up, while remaining 615 closed down.
Shares of financial companies went up, with Australia & New Zealand Banking Group rising 0.06% to A$35.31 and National Australia Bank up 0.5% to A$37.78. Commonwealth Bank of Australia, the nation's largest lender, fell 0.2% to A$90.87 and Westpac Banking Corporation fell 0.2% to A$37.88. QBE Insurance Group went up 4.8% to A$13.05 after Bell Potter hiked target-price. Fellow insurer Suncorp Group rose 2% to A$14.13 after updating investors on the likely costs from Cyclone Marcia, which it said would be limited thanks to its reinsurance coverage.
Shares of media company Seven Group Holdings jumped 10.8% to A$6.85, after announcement of a large buyback plan offsetting an almost three-quarters drop for its six-month earnings.
Resource-services major WorleyParsons dipped 12.2% to A$9.86 after announcing first-half profit was down 7% and that the plunge in oil prices was weighing on its outlook.
Westfield Corp lost 0.5% to A$10.09 after the international shopping-mall developer reported a loss for 2014.
The Australian Bureau of Statistics said on Wednesday that Australian Wages excluding bonuses rose by 0.6% from the third quarter, and climbed 2.5% from a year earlier.
Australia's jobless rate hit a more-than 12-year high of 6.4% in January and is forecast to rise further this year. The central bank cut interest rates to a record low 2.25% at the start of this month in a bid to lift growth and forestall even higher levels of joblessness.
Japan stocks mixed after Yellen comments
Japanese share market closed down in quiet trade, dragged down by greenback weakness against the yen and as many blue chip companies traded without the right to the next dividend payment. The Nikkei Stock Average ended down 0.1% at 18585.20 after closing yesterday at a 15-year high. The broader Topix index was edge down by 0.04% to 1507.62.
NTT Data Corp. added 2.4% to 4870 yen after JPMorgan Chase & Co. raised its rating on the stock to overweight from underweight, while boosting its target share price by 58% to 5,700 yen.
Aeon Co., Japan's largest retailer, fell 0.8% after the stock went ex-dividend today. Pachinko slot machine maker Sankyo Co. sank 6.2% to 4,505 yen after cutting its profit forecast. The company cut its net-income forecast for the year by 42% on slowing sales.
Central Japan Railway Co. slid 3.7% on profit booking after rallying for nine straight days through Monday to a record high.
China stocks drop on profit booking after holiday break
Mainland China share market closed down on first trading day of the Year of the Goat (Wednesday, 25 February 2015), as profit booking triggered on fading speculation of further monetary easing after a preliminary reading of China's manufacturing activity printed at a four-month high. The Shanghai Composite Index fell 0.6% to 3,228.84 at the close. China market resumed trading Wednesday after a week of lunar New Year holidays.
The manufacturing purchasing managers' index for February from HSBC Holdings Plc and Markit Economics came in at 50.1, unexpectedly rising from 49.7 in January. Readings below 50 signal contraction in the sector.
Total of seven out of ten SSE industry groups declined, with financial issue leading retreat, down by 2%, followed by information technology (down 1.6%), telecommunication services (down 1%), consumer discretionary (down 0.9%), industrial (down 0.8%), materials (down 0.5%), and healthcare (down 0.1%).
Shares of financial and realty companies dropped the most in Beijing. China Life Insurance Co. dropped 4.5% and Poly Real Estate Group Co. lost 3.5%.
Hang Seng ends 0.11% up
Hong Kong share market closed higher in volatile trade on tracking record-setting gains on Wall Street overnight on remarks from Federal Reserve Chairwoman Janet Yellen, relief over a Greek debt deal, and a better-than-expected HSBC flash PMI from China. The benchmark index opened 72 points higher in tandem with overseas markets, and then reversed its trend and fell 58 points at one stage before recovering. The Hang Seng Index ended up 28.21 points or 0.11% to 24778.28, off an intra-day high of 24869.37 and day low of 24691.78. Turnover rose to HK$71.38 billion from HK$57.96 billion on Tuesday.
Shares of casino players declined on market prediction that Macau's gambling revenue may plunge about 54% this month as number of mass tables empty on the third and fourth days of Lunar New Year holidays. Macau government yesterday said it would review the "individual visit scheme". In addition, many research houses are bearish for the outlook of Macau gaming industry. Daiwa said gaming revenues may decline 22%, while Barclays estimated gross gaming revenue in February to plunge 53%. Galaxy Ent (0027) dived 5.1% to HK$38.80. Sands China (1928) slid 5.8% to HK$35.70. Melco International Development (0200) dropped 6.1% to HK$15.88, Wynn Macau (01128) sank 5.9% to HK$20.65 and Melco Crown Entertainment (6883) fell 5.9% to HK$65.15.
The Financial Secretary John Tsang in 2015-16 Budget Speech on Wednesday revised estimate for government revenue for 2014-15 to HK$470.7 billion, higher by 9.4% or HK$40.6 billion than the original estimate. It reflects mainly the changes in the revenue items and the arrangement for the Housing Reserve, including stamp duty revenue is HK$29.7 billion higher than the original estimate, representing an increase of over 60%. Of this revenue, over 75%comes from "double stamp duty" which was not budgeted; revenue from profits tax is HK$18.5 billion or 15.8% higher than originally estimated. It is affected mainly by corporate earnings which are far more volatile than macroeconomic growth, rendering it difficult to make an accurate estimate; and revenues from salaries tax and land premium are HK$5.1 billion and HK$3.2 billion higher than their respective original estimates. As for government expenditure, Tsang forecasts a revised estimate of HK$397.2 billion, 3.4% or HK$14 billion lower than the original estimate. For 2014-15, he forecasts a surplus of HK$63.8 billion, and by 31 March 2015, fiscal reserves are expected to reach HK$819.5 billion.
Sensex rises 0.6% in afternoon trade
Indian benchmark indices trimmed intraday gains in afternoon trade after a range-bound movement in early afternoon trade. At 13:16 IST, the S&P BSE Sensex was up 166.98 points or 0.58% at 29,171.64. The CNX Nifty was up 49.85 points or 0.57% at 8,811.95. The market breadth indicating the overall health of the market was positive.
Index heavyweights HDFC and Infosys edged higher. Cement stocks edged higher amid expectations that the government will rationalize excise duty structure for the cement sector when the Finance Minister Arun Jaitley presents Union Budget 2015-16 in parliament on Saturday, 28 February 2015. Auto shares were in demand.
Meanwhile, the finance ministry yesterday, 24 February 2015, said that the central government has accepted the recommendation of the 14th Finance Commission (FFC) to keep the States' share of Union Tax proceeds (net) at 42%. The Rajya Sabha yesterday, 24 February 2015, passed the Public Premises (Eviction of Unauthorised Occupants) Amendment Bill, 2014 that seeks to empower Delhi Metro Rail Corporation, other Metros, Public Transport Companies, Companies of Delhi Government, New Delhi Municipal Council and successors to Major Port Trusts to get their properties and premises evicted of unauthorized companies in a speedy manner.
Foreign portfolio investors (FPIs) bought shares worth a net Rs 697.28 crore yesterday, 24 February 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) sold shares worth a net Rs 146.98 crore yesterday, 24 February 2015, as per provisional data.
Indian market may remain volatile in the near future as traders roll over positions in the futures & options (F&O) segment from the near month February 2015 series to March 2015 series. The near month February 2015 derivatives contracts expire tomorrow, 26 February 2015.
Elsewhere in the Asia Pacific region: South Korea KOSPI rose 0.73% to 1990.47. Taiwan's Taiex rose 0.73% to 9699.54. New Zealand NZX50 added 2.1% to 5842.29. Indonesia's Jakarta Composite index grew 0.51% to 5445.11. Singapore's Straits Times index jumped 0.12% at 3441.60. Malaysia's KLCI was down 0.16% to 1815.86.
The US Federal Reserve Chairwoman Janet Yellen reassured investors with her testimony before Congress that the US labour market still showed some weakness and inflation continued to fall, making any interest rate hike unlikely before June.
Euro-zone finance ministers approved a four-month bailout extension for Greece on Tuesday after the government pledged to revamp tax collection, consolidate pension funds and maintain sales of state-owned assets. The accord paves the way for the European Central Bank to continue support of Greek lenders, while buying time for the euro area's most indebted state to convince creditors it will deliver.
The preliminary HSBC China Manufacturing Purchasing Managers' Index, a gauge of nationwide manufacturing activity, rose to 50.1 in February compared with a final reading of 49.7 in January, HSBC Holdings PLC said on Wednesday. A reading below 50 indicates a contraction in manufacturing activity from the previous month, whereas a reading above indicates expansion. "Today's flash manufacturing PMI data point to a marginal improvement in the Chinese manufacturing sector going into the Chinese New Year period in February," HSBC's chief economist for China, Qu Hongbin, said in a statement.
Among Asian bourses
Australia stocks up for third straight day
The Australian share market advanced for third straight day, as a positive lead from the Wall Street overnight helping to overcome a bit of earnings-related weakness. The benchmark S&P/ASX 200 Index rose 0.3% to 5944.90 points, its highest close since May 2008, while the broader All Ordinaries Index was up 0.32% to 5908.60 points. Market turnover was relatively healthy, with 1.78 billion shares changing hands worth of A$5.25 billion. Total of 774 stocks were up, while remaining 615 closed down.
Shares of financial companies went up, with Australia & New Zealand Banking Group rising 0.06% to A$35.31 and National Australia Bank up 0.5% to A$37.78. Commonwealth Bank of Australia, the nation's largest lender, fell 0.2% to A$90.87 and Westpac Banking Corporation fell 0.2% to A$37.88. QBE Insurance Group went up 4.8% to A$13.05 after Bell Potter hiked target-price. Fellow insurer Suncorp Group rose 2% to A$14.13 after updating investors on the likely costs from Cyclone Marcia, which it said would be limited thanks to its reinsurance coverage.
Shares of media company Seven Group Holdings jumped 10.8% to A$6.85, after announcement of a large buyback plan offsetting an almost three-quarters drop for its six-month earnings.
Resource-services major WorleyParsons dipped 12.2% to A$9.86 after announcing first-half profit was down 7% and that the plunge in oil prices was weighing on its outlook.
Westfield Corp lost 0.5% to A$10.09 after the international shopping-mall developer reported a loss for 2014.
The Australian Bureau of Statistics said on Wednesday that Australian Wages excluding bonuses rose by 0.6% from the third quarter, and climbed 2.5% from a year earlier.
Australia's jobless rate hit a more-than 12-year high of 6.4% in January and is forecast to rise further this year. The central bank cut interest rates to a record low 2.25% at the start of this month in a bid to lift growth and forestall even higher levels of joblessness.
Japan stocks mixed after Yellen comments
Japanese share market closed down in quiet trade, dragged down by greenback weakness against the yen and as many blue chip companies traded without the right to the next dividend payment. The Nikkei Stock Average ended down 0.1% at 18585.20 after closing yesterday at a 15-year high. The broader Topix index was edge down by 0.04% to 1507.62.
NTT Data Corp. added 2.4% to 4870 yen after JPMorgan Chase & Co. raised its rating on the stock to overweight from underweight, while boosting its target share price by 58% to 5,700 yen.
Aeon Co., Japan's largest retailer, fell 0.8% after the stock went ex-dividend today. Pachinko slot machine maker Sankyo Co. sank 6.2% to 4,505 yen after cutting its profit forecast. The company cut its net-income forecast for the year by 42% on slowing sales.
Central Japan Railway Co. slid 3.7% on profit booking after rallying for nine straight days through Monday to a record high.
China stocks drop on profit booking after holiday break
Mainland China share market closed down on first trading day of the Year of the Goat (Wednesday, 25 February 2015), as profit booking triggered on fading speculation of further monetary easing after a preliminary reading of China's manufacturing activity printed at a four-month high. The Shanghai Composite Index fell 0.6% to 3,228.84 at the close. China market resumed trading Wednesday after a week of lunar New Year holidays.
The manufacturing purchasing managers' index for February from HSBC Holdings Plc and Markit Economics came in at 50.1, unexpectedly rising from 49.7 in January. Readings below 50 signal contraction in the sector.
Total of seven out of ten SSE industry groups declined, with financial issue leading retreat, down by 2%, followed by information technology (down 1.6%), telecommunication services (down 1%), consumer discretionary (down 0.9%), industrial (down 0.8%), materials (down 0.5%), and healthcare (down 0.1%).
Shares of financial and realty companies dropped the most in Beijing. China Life Insurance Co. dropped 4.5% and Poly Real Estate Group Co. lost 3.5%.
Hang Seng ends 0.11% up
Hong Kong share market closed higher in volatile trade on tracking record-setting gains on Wall Street overnight on remarks from Federal Reserve Chairwoman Janet Yellen, relief over a Greek debt deal, and a better-than-expected HSBC flash PMI from China. The benchmark index opened 72 points higher in tandem with overseas markets, and then reversed its trend and fell 58 points at one stage before recovering. The Hang Seng Index ended up 28.21 points or 0.11% to 24778.28, off an intra-day high of 24869.37 and day low of 24691.78. Turnover rose to HK$71.38 billion from HK$57.96 billion on Tuesday.
Shares of casino players declined on market prediction that Macau's gambling revenue may plunge about 54% this month as number of mass tables empty on the third and fourth days of Lunar New Year holidays. Macau government yesterday said it would review the "individual visit scheme". In addition, many research houses are bearish for the outlook of Macau gaming industry. Daiwa said gaming revenues may decline 22%, while Barclays estimated gross gaming revenue in February to plunge 53%. Galaxy Ent (0027) dived 5.1% to HK$38.80. Sands China (1928) slid 5.8% to HK$35.70. Melco International Development (0200) dropped 6.1% to HK$15.88, Wynn Macau (01128) sank 5.9% to HK$20.65 and Melco Crown Entertainment (6883) fell 5.9% to HK$65.15.
The Financial Secretary John Tsang in 2015-16 Budget Speech on Wednesday revised estimate for government revenue for 2014-15 to HK$470.7 billion, higher by 9.4% or HK$40.6 billion than the original estimate. It reflects mainly the changes in the revenue items and the arrangement for the Housing Reserve, including stamp duty revenue is HK$29.7 billion higher than the original estimate, representing an increase of over 60%. Of this revenue, over 75%comes from "double stamp duty" which was not budgeted; revenue from profits tax is HK$18.5 billion or 15.8% higher than originally estimated. It is affected mainly by corporate earnings which are far more volatile than macroeconomic growth, rendering it difficult to make an accurate estimate; and revenues from salaries tax and land premium are HK$5.1 billion and HK$3.2 billion higher than their respective original estimates. As for government expenditure, Tsang forecasts a revised estimate of HK$397.2 billion, 3.4% or HK$14 billion lower than the original estimate. For 2014-15, he forecasts a surplus of HK$63.8 billion, and by 31 March 2015, fiscal reserves are expected to reach HK$819.5 billion.
Sensex rises 0.6% in afternoon trade
Indian benchmark indices trimmed intraday gains in afternoon trade after a range-bound movement in early afternoon trade. At 13:16 IST, the S&P BSE Sensex was up 166.98 points or 0.58% at 29,171.64. The CNX Nifty was up 49.85 points or 0.57% at 8,811.95. The market breadth indicating the overall health of the market was positive.
Index heavyweights HDFC and Infosys edged higher. Cement stocks edged higher amid expectations that the government will rationalize excise duty structure for the cement sector when the Finance Minister Arun Jaitley presents Union Budget 2015-16 in parliament on Saturday, 28 February 2015. Auto shares were in demand.
Meanwhile, the finance ministry yesterday, 24 February 2015, said that the central government has accepted the recommendation of the 14th Finance Commission (FFC) to keep the States' share of Union Tax proceeds (net) at 42%. The Rajya Sabha yesterday, 24 February 2015, passed the Public Premises (Eviction of Unauthorised Occupants) Amendment Bill, 2014 that seeks to empower Delhi Metro Rail Corporation, other Metros, Public Transport Companies, Companies of Delhi Government, New Delhi Municipal Council and successors to Major Port Trusts to get their properties and premises evicted of unauthorized companies in a speedy manner.
Foreign portfolio investors (FPIs) bought shares worth a net Rs 697.28 crore yesterday, 24 February 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) sold shares worth a net Rs 146.98 crore yesterday, 24 February 2015, as per provisional data.
Indian market may remain volatile in the near future as traders roll over positions in the futures & options (F&O) segment from the near month February 2015 series to March 2015 series. The near month February 2015 derivatives contracts expire tomorrow, 26 February 2015.
Elsewhere in the Asia Pacific region: South Korea KOSPI rose 0.73% to 1990.47. Taiwan's Taiex rose 0.73% to 9699.54. New Zealand NZX50 added 2.1% to 5842.29. Indonesia's Jakarta Composite index grew 0.51% to 5445.11. Singapore's Straits Times index jumped 0.12% at 3441.60. Malaysia's KLCI was down 0.16% to 1815.86.
