Asia Pacific share market declined on Monday, 20 April 2015, as
investors shunned risk amid poor lead from the US and European markets
on Friday, jitters over Greece's future in the Eurozone, and China's
economic slowdown. Regional shares largely shrugged off China's surprise
weekend cut in banks' reserve requirement.
Major U.S. indices finished sharply lower at the end of last week. On Friday, the Dow Jones Industrial Average and Nasdaq Composite closed down 1.5%, respectively, while the S&P 500 index finished 1.1% lower.
Concerns over the lack of an agreement on economic reforms for bailout funds between Greece and its creditors remained in focus, fuelling fears that the debt-strapped nation could be forced out of the euro zone.
European Central Bank President Mario Draghi commented at the International Monetary Fund's spring meeting in Washington on Sunday that the fate of Greece remains in the hand of the Greek government as the country is running out of money and could default on its debts and potentially leave the euro zone.
France's central bank chief said Greek banks may soon run out of collateral to access European Central Bank refinancing unless Athens reaches an agreement with the European Union and International Monetary Fund on economic reforms.
China's central bank on Sunday cut the amount of cash that banks must hold as reserves, the second industry-wide cut in two months, adding more liquidity to the world's second-biggest economy to help spur bank lending and combat slowing growth. But, China's surprise one-percentage-point cut in banks' reserve requirement was interpreted negatively as illustrating heightened government concern over the nation's decelerating economic growth, which is now projected to fall to 7% on-year--the slowest pace in six years.
The People Bank of China has lowered the reserve requirement ratio (RRR) for all banks 100 basis points over the weekend. The wider than expected cut on Sunday was the China's central bank second reduction in two months as it steps up measures to boost bank lending and combat slowing growth. The reserve-ratio level will decline to 18.5%. An extra 1-percentage RRR cut was given to commercial banks for agricultural services and an additional reduction of 2 percentage points to the Agricultural Development Bank of China.
The central bank also further lowered RRR by 0.5 percentage point for eligible banks that lend a certain amount of loans to agricultural borrowers or small and micro businesses.
The Beijing measures to spur bank lending announced after authorities on late Friday tightened rules around buying stocks with borrowed money and bolstered short-selling.
Chinese regulators said on Friday, after mainland markets closed, that they would allow fund managers to lend shares for short-selling and would also expand the number of stocks investors can short sell, in a bid to raise the supply of securities in the market.
Among Asian bourses
Australia market weighs by miners, banks
The Australian share market ended lower on the first trading session of the week, on tracking losses in the US and European markets on Friday amid jitters over Greece's future in the euro zone and China's economic slowdown. The benchmark S&P/ASX 200 Index declined 43.80 points, or 0.75%, to 5834.10, while the broader All Ordinaries Index decreased 43 points, or 0.73%, to 5808.50. Market turnover was relatively healthy, with 1.78 billion shares changing hands worth of A$4.21 billion.
Shares of materials companies declined, with resource heavyweight BHP Billiton falling 0.3% to A$29.87 and Rio Tinto down 0.7% to A$54.68. Fortescue Metals Group added 1.1% to A$1.89, as investors chased for bottom fishing following recent selloff.
Arrium plunged 11.8% to A$0.15 on the back of a downbeat production report, while output and guidance numbers from Oz Minerals left its stock 0.5% down at A$3.89. Arrium's March quarter production report showed that its total cash cost-per-tonne of ore was $66.90 a tonne, but the average price realised for its lower grade iron ore was just $58 a tonne. OZ Minerals produced 31,160 tonnes of copper and 32,874 ounces of gold for the quarter ended March 2015, as compared to 18,182 tonnes of copper and 33,792 ounces of gold in the previous corresponding quarter.
Gold miner Evolution Mining fell 1.1% to A$0.92 after announcing it has bought the Australian mines of La Mancha Group International BV, but rival Perseus Mining rallied 1.7% to A$0.30 as it updated its mineral-reserves report for its Edikan Gold Mine in Ghana.
Financial stocks were also down, with top lenders being major loser, amid continuing uncertainty over the RBA's next interest rate move. Commonwealth Bank declined 0.8% to A$91.38, Westpac Banking Corp 0.4% to A$38.74 and National Australia Bank 0.9% to A$38.36, while ANZ Banking Group rose 0.3% to A$35.70.
Nikkei down on stronger yen, weak offshore cues
Japanese share market finished the session down after fluctuating between gains and losses, on the back of US dollar weakness against the yen and poor lead from the US and European markets on Friday amid jitters over Greece's future in the eurozone and China's economic slowdown. The benchmark Nikkei 225 index dropped 18.39 points, or 0.09%, to finish at 19634.49, while the broader Topix index of all first-section shares declined 6.01 points, or 0.38%, to 1582.68.
Exporters were mostly lower, with tech, industrial, and auto players being major losers on tracking strength in Japanese yen against the greenback. The dollar was buying for 118.65 yen, as compared previous session around the 119 yen mark. Honda Motor Co fell 1.2% to 4177.50 yen, Toyota Motor Corp lost 0.4% to 8262 yen, and Suzuki Motor Corp dropped 0.5% to 3771.50 yen after reports that the car and motorcycle producer's operating profit likely fell by 5% during the fiscal year that ended in March. Sharp Corp slipped 1.5% to 257 yen, Nikon Corp 1.1% to 1691 yen, Renesas Electronics Corp 2.4% to 862 yen, and Kawasaki Heavy Industries 1% to 601 yen.
Nomura Real Estate Holdings Inc declined 5.4% to 2395 yen after a brokerage houses downgraded its shares. Mitsubishi UFJ Morgan Stanley Securities Co. downgraded its rating on the property developer to equalweight from overweight, citing rising construction costs and slowing sales of condominiums will make it harder to beat expectations.
Itochu Corp. dropped 1.5% to 1429.50 yen after saying it will book a charge of up to 4.3 billion yen in the fiscal year that ended in March after an employee made improper transactions at the trading firm.
Panasonic Corp advanced 2% to 1588 yen after reports that the firm's net profit likely soared 70% to about 200 billion yen for the year ended March 31, helped by successful structural reforms and strong sales of auto and housing-related products. Barclays raised its target price to 1,630 yen from 1,500 yen while keeping its equal-weight rating, citing conservative company guidance.
Machinery maker Okuma added 5.1% to 1247 yen after a Mitsubishi UFJ Morgan Stanley Securities upgraded to overweight from underweight and 71% target price to Y1,470, citing energy saving investments and substantial capex in industrial machinery systems at the company.
China market slips 1.64%
Mainland China equity market closed down in volatile trade, as investors concern about steps by government to curb margin trading outweighed additional monetary easing in the world's second-largest economy. Shanghai Composite Index declined 70.22 points, or 1.64% to 4217.08 at the close, off an intraday peak of 4356. The CSI300 index, the largest listed companies in Shanghai and Shenzhen, slipped 74.22 points, or 1.61%, to 4521.92.
Barring industrial, all SSE industry groups declined, with financial issue leading the retreat, with a loss of 4.4%, followed by information technology issue which ended 3.6% down. Meanwhile, healthcare sector declined 3.3%, consumer discretionary down 1.2%, energy down 1%, consumer staple down 1%, utilities down 0.6%, materials down 0.5%, and telecommunication services down 0.2%.
Shares of media companies were among the outperformers, with United Network, Shanghai Oriental Pearl Group and BesTV New Media charged up by the daily limit of 10%.
Banking counters were mixed, with Agricultural Bank of China up 1%, while the mainland's largest lender Industrial and Commercial Bank of China and China Construction Bank lost more than 1% each.
Hang Seng tanks 2.02%
Hong Kong stock market stumbled, as investors shunned risk amid weak lead from offshore bourses, new trading regulations in China, and renewed worries about Greece's cash crunch. Most of the blue chips declined with industrial goods companies and energy producers leading declines. The Hang Seng Index ended down 558.19 points or 2.02% to 27094.93, off an intra-day high of 27770.79 and day low of 26959.77. Turnover decreased to HK$211 billion from HK$214.52 billion on Friday.
Shares rail makers declined on profit taking following sharp recent rally. CSR (01766) plunged 11% to HK$17.7, while China CNR (006199) slid 13% to HK$18.6. China Comm Con (01800) and China Rail Cons (01186) declined 3.6% to HK$15.22 and HK$15.9. China Railway (00390) fell 3.4% to HK$11.5.
Chinese telecom operators were higher on Credit Suisse's bullish comments. China Mobile (00941) edged up 0.1% to HK$107.8. China Unicom (00762) put on 2.3% to HK$14. China Telecom (00728) jumped 2.7% to HK$5.61.
Sensex slips over 550 points, Nifty below 8500
Indian stock market ended steep lower, due to uninspiring quarterly earnings, parliamentary logjam, and likely exit of debt-ridden Greece from the European Union. The S&P BSE Sensex provisionally closed 1.95%, 555.89 points, lower at 27,886.21, while the CNX Nifty ended 1.83%, or 157.90 points, lower at 8,448.10. Investors are keenly watching corporate earnings, while overseas investors are awaiting clarity on tax-related issues, analysts said.
Foreign portfolio investors sold Indian shares worth a net Rs 675.71 crore during the previous trading session on Friday, 17 April 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 72.52 crore on Friday, 17 April 2015, as per provisional data released by the stock exchanges.
Technology stocks fell for the third straight session with Tata Consultancy Services down 1.9%, after the country's largest software services exporter's January-March revenue fell short of expectations. Infosys was down 2.2%.
ITC declined 2.4% after rising 8% this month until Friday. NMDC fell 5.2% to Rs. 126.70 after it cut iron ore prices by up to 20%.
Elsewhere in the Asia Pacific region: South Korea KOSPI added 0.15% to 2146.71. Taiwan's Taiex index slid 0.19% to 9552.85. New Zealand NZX50 declined 0.63% to 5824.28. Singapore's Straits Times index lost 0.62% at 3503.25. Indonesia's Jakarta Composite index slipped 0.18% to 5400.80. Malaysia's KLCI edged up 0.04% to 1848.66.
Major U.S. indices finished sharply lower at the end of last week. On Friday, the Dow Jones Industrial Average and Nasdaq Composite closed down 1.5%, respectively, while the S&P 500 index finished 1.1% lower.
Concerns over the lack of an agreement on economic reforms for bailout funds between Greece and its creditors remained in focus, fuelling fears that the debt-strapped nation could be forced out of the euro zone.
European Central Bank President Mario Draghi commented at the International Monetary Fund's spring meeting in Washington on Sunday that the fate of Greece remains in the hand of the Greek government as the country is running out of money and could default on its debts and potentially leave the euro zone.
France's central bank chief said Greek banks may soon run out of collateral to access European Central Bank refinancing unless Athens reaches an agreement with the European Union and International Monetary Fund on economic reforms.
China's central bank on Sunday cut the amount of cash that banks must hold as reserves, the second industry-wide cut in two months, adding more liquidity to the world's second-biggest economy to help spur bank lending and combat slowing growth. But, China's surprise one-percentage-point cut in banks' reserve requirement was interpreted negatively as illustrating heightened government concern over the nation's decelerating economic growth, which is now projected to fall to 7% on-year--the slowest pace in six years.
The People Bank of China has lowered the reserve requirement ratio (RRR) for all banks 100 basis points over the weekend. The wider than expected cut on Sunday was the China's central bank second reduction in two months as it steps up measures to boost bank lending and combat slowing growth. The reserve-ratio level will decline to 18.5%. An extra 1-percentage RRR cut was given to commercial banks for agricultural services and an additional reduction of 2 percentage points to the Agricultural Development Bank of China.
The central bank also further lowered RRR by 0.5 percentage point for eligible banks that lend a certain amount of loans to agricultural borrowers or small and micro businesses.
The Beijing measures to spur bank lending announced after authorities on late Friday tightened rules around buying stocks with borrowed money and bolstered short-selling.
Chinese regulators said on Friday, after mainland markets closed, that they would allow fund managers to lend shares for short-selling and would also expand the number of stocks investors can short sell, in a bid to raise the supply of securities in the market.
Among Asian bourses
Australia market weighs by miners, banks
The Australian share market ended lower on the first trading session of the week, on tracking losses in the US and European markets on Friday amid jitters over Greece's future in the euro zone and China's economic slowdown. The benchmark S&P/ASX 200 Index declined 43.80 points, or 0.75%, to 5834.10, while the broader All Ordinaries Index decreased 43 points, or 0.73%, to 5808.50. Market turnover was relatively healthy, with 1.78 billion shares changing hands worth of A$4.21 billion.
Shares of materials companies declined, with resource heavyweight BHP Billiton falling 0.3% to A$29.87 and Rio Tinto down 0.7% to A$54.68. Fortescue Metals Group added 1.1% to A$1.89, as investors chased for bottom fishing following recent selloff.
Arrium plunged 11.8% to A$0.15 on the back of a downbeat production report, while output and guidance numbers from Oz Minerals left its stock 0.5% down at A$3.89. Arrium's March quarter production report showed that its total cash cost-per-tonne of ore was $66.90 a tonne, but the average price realised for its lower grade iron ore was just $58 a tonne. OZ Minerals produced 31,160 tonnes of copper and 32,874 ounces of gold for the quarter ended March 2015, as compared to 18,182 tonnes of copper and 33,792 ounces of gold in the previous corresponding quarter.
Gold miner Evolution Mining fell 1.1% to A$0.92 after announcing it has bought the Australian mines of La Mancha Group International BV, but rival Perseus Mining rallied 1.7% to A$0.30 as it updated its mineral-reserves report for its Edikan Gold Mine in Ghana.
Financial stocks were also down, with top lenders being major loser, amid continuing uncertainty over the RBA's next interest rate move. Commonwealth Bank declined 0.8% to A$91.38, Westpac Banking Corp 0.4% to A$38.74 and National Australia Bank 0.9% to A$38.36, while ANZ Banking Group rose 0.3% to A$35.70.
Nikkei down on stronger yen, weak offshore cues
Japanese share market finished the session down after fluctuating between gains and losses, on the back of US dollar weakness against the yen and poor lead from the US and European markets on Friday amid jitters over Greece's future in the eurozone and China's economic slowdown. The benchmark Nikkei 225 index dropped 18.39 points, or 0.09%, to finish at 19634.49, while the broader Topix index of all first-section shares declined 6.01 points, or 0.38%, to 1582.68.
Exporters were mostly lower, with tech, industrial, and auto players being major losers on tracking strength in Japanese yen against the greenback. The dollar was buying for 118.65 yen, as compared previous session around the 119 yen mark. Honda Motor Co fell 1.2% to 4177.50 yen, Toyota Motor Corp lost 0.4% to 8262 yen, and Suzuki Motor Corp dropped 0.5% to 3771.50 yen after reports that the car and motorcycle producer's operating profit likely fell by 5% during the fiscal year that ended in March. Sharp Corp slipped 1.5% to 257 yen, Nikon Corp 1.1% to 1691 yen, Renesas Electronics Corp 2.4% to 862 yen, and Kawasaki Heavy Industries 1% to 601 yen.
Nomura Real Estate Holdings Inc declined 5.4% to 2395 yen after a brokerage houses downgraded its shares. Mitsubishi UFJ Morgan Stanley Securities Co. downgraded its rating on the property developer to equalweight from overweight, citing rising construction costs and slowing sales of condominiums will make it harder to beat expectations.
Itochu Corp. dropped 1.5% to 1429.50 yen after saying it will book a charge of up to 4.3 billion yen in the fiscal year that ended in March after an employee made improper transactions at the trading firm.
Panasonic Corp advanced 2% to 1588 yen after reports that the firm's net profit likely soared 70% to about 200 billion yen for the year ended March 31, helped by successful structural reforms and strong sales of auto and housing-related products. Barclays raised its target price to 1,630 yen from 1,500 yen while keeping its equal-weight rating, citing conservative company guidance.
Machinery maker Okuma added 5.1% to 1247 yen after a Mitsubishi UFJ Morgan Stanley Securities upgraded to overweight from underweight and 71% target price to Y1,470, citing energy saving investments and substantial capex in industrial machinery systems at the company.
China market slips 1.64%
Mainland China equity market closed down in volatile trade, as investors concern about steps by government to curb margin trading outweighed additional monetary easing in the world's second-largest economy. Shanghai Composite Index declined 70.22 points, or 1.64% to 4217.08 at the close, off an intraday peak of 4356. The CSI300 index, the largest listed companies in Shanghai and Shenzhen, slipped 74.22 points, or 1.61%, to 4521.92.
Barring industrial, all SSE industry groups declined, with financial issue leading the retreat, with a loss of 4.4%, followed by information technology issue which ended 3.6% down. Meanwhile, healthcare sector declined 3.3%, consumer discretionary down 1.2%, energy down 1%, consumer staple down 1%, utilities down 0.6%, materials down 0.5%, and telecommunication services down 0.2%.
Shares of media companies were among the outperformers, with United Network, Shanghai Oriental Pearl Group and BesTV New Media charged up by the daily limit of 10%.
Banking counters were mixed, with Agricultural Bank of China up 1%, while the mainland's largest lender Industrial and Commercial Bank of China and China Construction Bank lost more than 1% each.
Hang Seng tanks 2.02%
Hong Kong stock market stumbled, as investors shunned risk amid weak lead from offshore bourses, new trading regulations in China, and renewed worries about Greece's cash crunch. Most of the blue chips declined with industrial goods companies and energy producers leading declines. The Hang Seng Index ended down 558.19 points or 2.02% to 27094.93, off an intra-day high of 27770.79 and day low of 26959.77. Turnover decreased to HK$211 billion from HK$214.52 billion on Friday.
Shares rail makers declined on profit taking following sharp recent rally. CSR (01766) plunged 11% to HK$17.7, while China CNR (006199) slid 13% to HK$18.6. China Comm Con (01800) and China Rail Cons (01186) declined 3.6% to HK$15.22 and HK$15.9. China Railway (00390) fell 3.4% to HK$11.5.
Chinese telecom operators were higher on Credit Suisse's bullish comments. China Mobile (00941) edged up 0.1% to HK$107.8. China Unicom (00762) put on 2.3% to HK$14. China Telecom (00728) jumped 2.7% to HK$5.61.
Sensex slips over 550 points, Nifty below 8500
Indian stock market ended steep lower, due to uninspiring quarterly earnings, parliamentary logjam, and likely exit of debt-ridden Greece from the European Union. The S&P BSE Sensex provisionally closed 1.95%, 555.89 points, lower at 27,886.21, while the CNX Nifty ended 1.83%, or 157.90 points, lower at 8,448.10. Investors are keenly watching corporate earnings, while overseas investors are awaiting clarity on tax-related issues, analysts said.
Foreign portfolio investors sold Indian shares worth a net Rs 675.71 crore during the previous trading session on Friday, 17 April 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 72.52 crore on Friday, 17 April 2015, as per provisional data released by the stock exchanges.
Technology stocks fell for the third straight session with Tata Consultancy Services down 1.9%, after the country's largest software services exporter's January-March revenue fell short of expectations. Infosys was down 2.2%.
ITC declined 2.4% after rising 8% this month until Friday. NMDC fell 5.2% to Rs. 126.70 after it cut iron ore prices by up to 20%.
Elsewhere in the Asia Pacific region: South Korea KOSPI added 0.15% to 2146.71. Taiwan's Taiex index slid 0.19% to 9552.85. New Zealand NZX50 declined 0.63% to 5824.28. Singapore's Straits Times index lost 0.62% at 3503.25. Indonesia's Jakarta Composite index slipped 0.18% to 5400.80. Malaysia's KLCI edged up 0.04% to 1848.66.
