Asia Pacific share market declined on Thursday, 25 June 2015, as
investment rationale soured after negotiations between Greece and its
creditors stumbled, fuelling fears it will default on a loan.
Talks to keep Greece solvent stumbled just ahead of a deadline to reach a bailout deal, with divisions over pension cuts and other conditions for aid prompted European finance chiefs to cut short negotiations on Wednesday. That set the tone for financial markets, weighing U.S. stocks to suffer a biggest one-day decline in nearly a month in overnight trading and also triggered a risk aversion selloff in the Asian markets.
Greece will restart crunch talks with its creditors today, 25 June 2015, in a bid to save Athens from default, after Greece's international creditors yesterday, 24 June 2015, rejected Greece's latest reform proposals.
Without a new transfer from its 245 billion euro bailout plan by June 30, Athens will be unable to make a 1.54 billion euro payment to the IMF. A default on its international creditors — the IMF and other euro-zone governments — could force Greece into a messy exit from the euro.
Among Asian bourses
Nikkei drops 0.46% from 18.5 years peak
Japanese share market finished lower for the first time in five consecutive sessions, as some apparent profit taking triggered after the market closed at highest level since December 1996 on Wednesday, 24 June 2015. Meanwhile, a weak session on Wall Street overnight, a flat yen, and lack of a resolution of Greece with its creditors also weighed on investors sentiments. The Nikkei Stock Average declined 96.63 points, or 0.46%, to finish at 20771.40. The Topix index of all Tokyo Stock Exchange First Section issues dropped 0.53%, or 8.98 points, to close at 1670.91.
Export-related stocks closed mixed, after dollar also lost strength against the yen through the course of the day. Sony Corp was up 1.6%, Nikon Corp rose 3.4%, and Fast Retailing Co added 0.7%, while Panasonic Corp declined 0.2%, Toyota Motor Corp lost 1.3%, and Nissan Motor Co sank 1.6%. Fanuc Corp. sank 2.7% after Goldman Sachs Group Inc. cut its target price on the robotics maker and removed it from the brokerage's conviction list.
TDK Corp shed 4.5% after negative comments by Morgan Stanley MUFG Securities regarding its hard disk-drive shipment outlook. The brokerage house predicts HDD head shipment volume is likely to be down by more than the firm's projection of 5% from the prior quarter.
Australia stocks fall 1%
The Australian share market closed lower, as worries about a possible Greek default triggered risk aversion selloff across the board, with blue chip shares of IT, industrials, energy, resources, and consumer goods companies leading fall. The benchmark S&P/ASX 200 Index dropped 54.10 points, or 0.95%, to 5632.70, while the broader All Ordinaries Index lost 52.80 points, or 0.93%, to 5619.90. Market turnover was above average with 2 billion shares changing hands worth of A$4.49 billion.
Materials and resources stocks closed mostly lower, with Rio Tinto and BHP Billiton both down 0.1% to A$55.63 and A$28.51, respectively. Junior iron ore producer Fortescue Metals Group declined 3.6% to A$2.12. Oz Minerals lost 5.1% to A$4.28 on the back of a Credit Suisse downgrade of its shares to neutral from outperform. On the upside, Sandfire Resources rallied 3% to A$6.10, and Talisman Mining climbed 23.1% to A$0.56 after the pair confirmed a fresh copper-and-gold find at its joint venture's Springfield Project.
Shares of law firm Slater and Gordon declined 17.5% to A$5.06 as UK authorities probed the accounts of the Quindell insurance group it recently bought a slice of.
Retailer Myer Holdings closed steady at A$1.34 after announcing it had refinanced about $460 million of debt at better rates.
Shares of Macmahon Holdings spurted 47.8% to A$0.07 after announcing the sale of its Mongolian unit for roughly $65 million. Macmahon said completion of the sale would result in it exiting from its mining contract with Erdenes Tavan Tolgoi LLC, with whom it had been in dispute over payment delay.
China market stocks tumble on profit taking
The Mainland China share market closed sharply down in volatile trading, as some investors took advantage of gains in morning to reduce risk exposure. All 10 industry groups in the SSE Index dropped, with a sub-index of technology, consumer discretionary, healthcare, materials, and energy companies being top losers. The Shanghai Composite Index declined 162.37 points, or 3.46% to end at 4527.78, erasing an intraday gain of 0.7% and snapping a two-day, 4.7% advance. The Shenzhen Composite Index, which tracks stocks on China's second exchange, retreated 3.76%, or 106.02 points, to 2716.71.
Shares of technology companies were biggest drag in the Beijing market on profit taking amid mounting concern valuations are too high relative to earnings growth. Beijing Shiji Information Technology Co. and Hundsun Technologies Inc. both fell by the 10% daily limit. Leshi Internet Information & Technology (Beijing) Co. dropped 7.9%.
Banks and financial stocks were also down amid bout of panic selling despite China's decision to scrap debt-to-loan ratios (LDRs). Increasingly cautious investors ignored central bank's market-friendly move to ease short-term liquidity. China will remove the country's long-standing loan-to-deposit ratio requirement of 75%, in a bid to lend out more to a slowing economy, according to a statement by the State Council late Wednesday. Market economists expects the removal could allow 3.5 trillion yuan of potential credit into China's financial system, equivalent to a 250 basis point cut to banks' reserve ratio requirements.
Industrial & Commercial Bank of China declined 1.3% to 5.15 yuan, Agricultural Bank of China lost 1.6% to 3.69 yuan, and Bank of Communication dropped 3% to 7.84 yuan.
Hong Kong market falls
The Hong Kong stock market closed down, breaking a four-day rising streak, as jitters over apparently stalled Greek debt negotiations triggered profit-taking. A decline in the Mainland market also soured investors' sentiments. The Hang Seng Index dropped 259.22 points or 0.95% to finish at 27120.72, off an intra-day high of 27350.49 and day low of 27120.72. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, declined 216.90 points, or 1.58%, to 13467.90 points. Turnover reduced slightly to HK$118.5 billion from HK$117 billion on Wednesday.
Shares of Chinese banks were mixed after reports that China will remove the mandatory Loan to Deposit ratio (LDR) for banks. Minsheng Bank (01988) gained 2% to HK$10.66. But CCB (00939) slipped 1.2% to HK$7.28.
Elsewhere, Lenovo (00992) slid 3% to HK$10.94 ahead of its parent company Legend Holding's (03396) upcoming debut on the local stock exchange on Monday.
L&M Handbags (01488) soared 27% to HK$1.49 after announcing its controlling shareholder had been approached by an independent third party with a proposal to acquire its stake in the listed company.
Sensex hits highest level in almost five weeks
Indian market ended higher amid volatile trades owing to expiry of derivatives contracts for the month of June, with shares of capital goods, oil & gas and banking players being major gainers. But, the gains in market were capped due to losses in technology and FMCG stocks. As per provisional closing, the S&P BSE Sensex was up 204.27 points or 0.74% to 27933.94, while the Nifty was up 37.15 points or 0.44% at 8398.
Labour Minister Bandaru Dattatreya was quoted as saying in an interview to a news agency yesterday, 24 June 2015, that the Employees Provident Fund Organisation (EPFO) will invest about $800 million in equities in the current fiscal year starting from July 2015.
Prime Minister Narendra Modi today, 25 June 2015, launched three mega urban development initiatives viz., Smart Cities Mission, Atal Mission for Rejuvenation and Urban Transformation (AMRUT) and Housing for All in urban area.
Meanwhile, Reserve Bank of India Governor Raghuram Rajan was quoted as saying at a conference in Stockholm yesterday, 24 June 2015, that Indian financial markets have the strength to withstand any fallout of a Greek default on its repayment obligations.
Foreign portfolio investors (FPIs) bought Indian shares worth a net Rs 92.57 crore yesterday, 24 June 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 13.52 crore yesterday, 24 June 2015, as per provisional data released by the stock exchanges.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index rose 0.8% to 9476.34. South Korea's KOSPI fell 0.02% to 2085.06. New Zealand's NZX50 dropped 0.7% to 5733.29. Singapore's Straits Times index lost 0.04% at 3349.87. Malaysia's KLCI declined 0.9% to 1716.81. Indonesia's Jakarta Composite index fell 0.7% to 4920.04.
Talks to keep Greece solvent stumbled just ahead of a deadline to reach a bailout deal, with divisions over pension cuts and other conditions for aid prompted European finance chiefs to cut short negotiations on Wednesday. That set the tone for financial markets, weighing U.S. stocks to suffer a biggest one-day decline in nearly a month in overnight trading and also triggered a risk aversion selloff in the Asian markets.
Greece will restart crunch talks with its creditors today, 25 June 2015, in a bid to save Athens from default, after Greece's international creditors yesterday, 24 June 2015, rejected Greece's latest reform proposals.
Without a new transfer from its 245 billion euro bailout plan by June 30, Athens will be unable to make a 1.54 billion euro payment to the IMF. A default on its international creditors — the IMF and other euro-zone governments — could force Greece into a messy exit from the euro.
Among Asian bourses
Nikkei drops 0.46% from 18.5 years peak
Japanese share market finished lower for the first time in five consecutive sessions, as some apparent profit taking triggered after the market closed at highest level since December 1996 on Wednesday, 24 June 2015. Meanwhile, a weak session on Wall Street overnight, a flat yen, and lack of a resolution of Greece with its creditors also weighed on investors sentiments. The Nikkei Stock Average declined 96.63 points, or 0.46%, to finish at 20771.40. The Topix index of all Tokyo Stock Exchange First Section issues dropped 0.53%, or 8.98 points, to close at 1670.91.
Export-related stocks closed mixed, after dollar also lost strength against the yen through the course of the day. Sony Corp was up 1.6%, Nikon Corp rose 3.4%, and Fast Retailing Co added 0.7%, while Panasonic Corp declined 0.2%, Toyota Motor Corp lost 1.3%, and Nissan Motor Co sank 1.6%. Fanuc Corp. sank 2.7% after Goldman Sachs Group Inc. cut its target price on the robotics maker and removed it from the brokerage's conviction list.
TDK Corp shed 4.5% after negative comments by Morgan Stanley MUFG Securities regarding its hard disk-drive shipment outlook. The brokerage house predicts HDD head shipment volume is likely to be down by more than the firm's projection of 5% from the prior quarter.
Australia stocks fall 1%
The Australian share market closed lower, as worries about a possible Greek default triggered risk aversion selloff across the board, with blue chip shares of IT, industrials, energy, resources, and consumer goods companies leading fall. The benchmark S&P/ASX 200 Index dropped 54.10 points, or 0.95%, to 5632.70, while the broader All Ordinaries Index lost 52.80 points, or 0.93%, to 5619.90. Market turnover was above average with 2 billion shares changing hands worth of A$4.49 billion.
Materials and resources stocks closed mostly lower, with Rio Tinto and BHP Billiton both down 0.1% to A$55.63 and A$28.51, respectively. Junior iron ore producer Fortescue Metals Group declined 3.6% to A$2.12. Oz Minerals lost 5.1% to A$4.28 on the back of a Credit Suisse downgrade of its shares to neutral from outperform. On the upside, Sandfire Resources rallied 3% to A$6.10, and Talisman Mining climbed 23.1% to A$0.56 after the pair confirmed a fresh copper-and-gold find at its joint venture's Springfield Project.
Shares of law firm Slater and Gordon declined 17.5% to A$5.06 as UK authorities probed the accounts of the Quindell insurance group it recently bought a slice of.
Retailer Myer Holdings closed steady at A$1.34 after announcing it had refinanced about $460 million of debt at better rates.
Shares of Macmahon Holdings spurted 47.8% to A$0.07 after announcing the sale of its Mongolian unit for roughly $65 million. Macmahon said completion of the sale would result in it exiting from its mining contract with Erdenes Tavan Tolgoi LLC, with whom it had been in dispute over payment delay.
China market stocks tumble on profit taking
The Mainland China share market closed sharply down in volatile trading, as some investors took advantage of gains in morning to reduce risk exposure. All 10 industry groups in the SSE Index dropped, with a sub-index of technology, consumer discretionary, healthcare, materials, and energy companies being top losers. The Shanghai Composite Index declined 162.37 points, or 3.46% to end at 4527.78, erasing an intraday gain of 0.7% and snapping a two-day, 4.7% advance. The Shenzhen Composite Index, which tracks stocks on China's second exchange, retreated 3.76%, or 106.02 points, to 2716.71.
Shares of technology companies were biggest drag in the Beijing market on profit taking amid mounting concern valuations are too high relative to earnings growth. Beijing Shiji Information Technology Co. and Hundsun Technologies Inc. both fell by the 10% daily limit. Leshi Internet Information & Technology (Beijing) Co. dropped 7.9%.
Banks and financial stocks were also down amid bout of panic selling despite China's decision to scrap debt-to-loan ratios (LDRs). Increasingly cautious investors ignored central bank's market-friendly move to ease short-term liquidity. China will remove the country's long-standing loan-to-deposit ratio requirement of 75%, in a bid to lend out more to a slowing economy, according to a statement by the State Council late Wednesday. Market economists expects the removal could allow 3.5 trillion yuan of potential credit into China's financial system, equivalent to a 250 basis point cut to banks' reserve ratio requirements.
Industrial & Commercial Bank of China declined 1.3% to 5.15 yuan, Agricultural Bank of China lost 1.6% to 3.69 yuan, and Bank of Communication dropped 3% to 7.84 yuan.
Hong Kong market falls
The Hong Kong stock market closed down, breaking a four-day rising streak, as jitters over apparently stalled Greek debt negotiations triggered profit-taking. A decline in the Mainland market also soured investors' sentiments. The Hang Seng Index dropped 259.22 points or 0.95% to finish at 27120.72, off an intra-day high of 27350.49 and day low of 27120.72. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, declined 216.90 points, or 1.58%, to 13467.90 points. Turnover reduced slightly to HK$118.5 billion from HK$117 billion on Wednesday.
Shares of Chinese banks were mixed after reports that China will remove the mandatory Loan to Deposit ratio (LDR) for banks. Minsheng Bank (01988) gained 2% to HK$10.66. But CCB (00939) slipped 1.2% to HK$7.28.
Elsewhere, Lenovo (00992) slid 3% to HK$10.94 ahead of its parent company Legend Holding's (03396) upcoming debut on the local stock exchange on Monday.
L&M Handbags (01488) soared 27% to HK$1.49 after announcing its controlling shareholder had been approached by an independent third party with a proposal to acquire its stake in the listed company.
Sensex hits highest level in almost five weeks
Indian market ended higher amid volatile trades owing to expiry of derivatives contracts for the month of June, with shares of capital goods, oil & gas and banking players being major gainers. But, the gains in market were capped due to losses in technology and FMCG stocks. As per provisional closing, the S&P BSE Sensex was up 204.27 points or 0.74% to 27933.94, while the Nifty was up 37.15 points or 0.44% at 8398.
Labour Minister Bandaru Dattatreya was quoted as saying in an interview to a news agency yesterday, 24 June 2015, that the Employees Provident Fund Organisation (EPFO) will invest about $800 million in equities in the current fiscal year starting from July 2015.
Prime Minister Narendra Modi today, 25 June 2015, launched three mega urban development initiatives viz., Smart Cities Mission, Atal Mission for Rejuvenation and Urban Transformation (AMRUT) and Housing for All in urban area.
Meanwhile, Reserve Bank of India Governor Raghuram Rajan was quoted as saying at a conference in Stockholm yesterday, 24 June 2015, that Indian financial markets have the strength to withstand any fallout of a Greek default on its repayment obligations.
Foreign portfolio investors (FPIs) bought Indian shares worth a net Rs 92.57 crore yesterday, 24 June 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 13.52 crore yesterday, 24 June 2015, as per provisional data released by the stock exchanges.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index rose 0.8% to 9476.34. South Korea's KOSPI fell 0.02% to 2085.06. New Zealand's NZX50 dropped 0.7% to 5733.29. Singapore's Straits Times index lost 0.04% at 3349.87. Malaysia's KLCI declined 0.9% to 1716.81. Indonesia's Jakarta Composite index fell 0.7% to 4920.04.
