Asia Pacific share market mostly staged a strong rebound on Thursday, 09
July 2015, as Beijing's latest efforts to halt a rout in Chinese stocks
finally bore fruit. Meanwhile, buying was also spirited by speculation
that the U.S. Federal Reserve might hold off on raising interest rates.
Chinese police and security regulators launched a joint probe into "vicious short-selling" on Thursday. Short selling involves selling an asset the trader does not own in anticipation of a fall in its price. Also on late Wednesday, China's market regulator barred major shareholders and executives of listed companies from selling their shares for the next six months.
Minutes from the most-recent Federal Reserve policy meeting showed the central bank remained cautious about the U.S. economy and raising interest rates. The minutes from the Federal Open Market Committee also warned about the pace of growth beyond the U.S., specifically in China, as well as turbulence that could result from the Greek debt crisis.
Fed officials need to see more signs of a strengthening U.S. economy before raising interest rates, according to minutes of the central bank's June policy meeting. The FOMC minutes likely nudged back the timing of the central bank's first interest-rate increase in nine years toward the end of the year or perhaps even into 2016. Higher U.S. rates would make the dollar more attractive, as they would increase returns on dollar-denominated investments.
Meanwhile, investors continue to monitor developments on Greece's debt crisis. A race to save Greece from bankruptcy and keep it in the euro gathered pace yesterday, 8 July 2015 when Athens reportedly formally applied for a three-year loan and European authorities launched an accelerated review of the request.
International Monetary Fund Managing Director Christine Lagarde yesterday, 8 July 2015 reportedly reiterated that Greece needs debt restructuring as part of a bailout deal, but warned that Athens won't receive special treatment as the government seeks to delay its loan repayments to the IMF.
Greece will submit a detailed reform proposal in the next few days, in a bid to unlock further bailout aid, the country's Prime Minister Alexis Tsipras reportedly told the European Parliament yesterday, 8 July 2015. Referring to his country's resounding "no" in Sunday's referendum, Tsipras stressed the vote wasn't a signal for Greece to break with Europe, but to return to the negotiating table with a stronger mandate.
Following the emergency euro zone summit in Brussels on 7 July 2015, European leaders gave debt-stricken Greece a final deadline of Sunday to reach a new bailout deal and avoid Greece's exit from the euro zone. Representatives of the 19-country euro zone said all 28 European Union leaders would meet on Sunday, 12 July 2015, to decide Greece's fate. Greece's last bailout expired last Tuesday and Greece missed a euro 1.6 billion payment to the IMF.
Among Asian bourses
Nikkei posts modest gain
Japanese share market ended in positive territory after recouping early losses, helped by the share price rebound in China and better than expected core machinery orders. The Nikkei Stock Average rebounded 117.85 points, or 0.6%, to end at 19855.50 points. The Topix index of all Tokyo Stock Exchange First Section issues fell 0.16%, or 2.59 points, to close at 1579.89 points.
Japanese core machinery orders rose seasonally adjusted 0.6% in May over the month, in a sign that domestic firms may be increasing capital spending. The rise was better than a 4.9% fall expected in the median forecast of economists, and came after a 3.8% increase in April.
Machinery orders are often seen as a leading indicator of corporate capital investment, which tends to increase when businesses are planning to expand their operations. The Bank of Japan's latest quarterly "tankan" survey showed that large companies expect to increase capex by 9.3% in the 12 months ending March 2016, a sharp change from the 1.2% cut they said they planned for the year in the previous survey.
Export-related stocks were mostly higher with companies with high exposure to the mainland enjoyed a reprieve in the afternoon session. Komatsu bounced up 1.6%, while Hitachi Construction Machinery closed up 0.4%. Trading giant Itochu Corp. rebounded with a 2.5% rise after slumping 9.2% the prior day, helped by a strong advance in Shanghai shares.
Fast Retailing ended up 4.1%. After the market close, the owner of clothes brand Uniqlo reported a 36% rise in nine-month profit.
Retailer Ryohin Keikaku soared 9.2% after the firm reported a March-May net profit rise of 65% on-year to 6 billion yen and revised up its full-year profit view, Nissan Motor closed down 0.6%, following the company's announcement of an abnormal deployment of an airbag made by Takata.
Australia stocks end flat
The Australian share market closed virtually flat after paring early losses, as a surprisingly rebound in Chinese equities and a better-than-expected employment report buoyed investors' confidence. Most of the ASX sectors closed higher, with gains were leading by Metals & Mining, Materials and Gold blue-chip stocks. The benchmark S&P/ASX 200 Index rose 1.50 points, or 0.03%, to 5471 points, while the broader All Ordinaries Index nudged down 0.20 point to 5456.30 points. The benchmark index entered a technical correction this morning, down 10.2% from its peak of 5,996.9 in April to a trough of 5,383.7 before recovering in the afternoon.
The Australian Bureau of Statistics said on Thursday that Australia's unemployment rate rose to a lower-than-expected 6.0% in June from a downwardly revised 5.9% in May. Economists had expected an unemployment rate of 6.1% in June. The number of people employed rose by 7,300, compared with expectations that the number would remain flat. The number of people in full-time work rose by 24,500 in June, while those in part-time work fell by 17,200. Unemployment has risen as the economy has slowed. The Reserve Bank of Australia expects the unemployment to nudge higher in the next year.
Materials and resources stocks advanced the most in Sydney market as investors chased for bottom fishing following recent slump. Among miners, Shares of BHP Billiton rebounded 1.8% to A$25.88, Rio Tinto 1.7% to A$50.89, and Fortescue Metals Group 6.6% to A$1.785. Western Areas jumped 6.6% to A$3.04, Alumina climbed 4.2% to A$1.48 and Sirius Resources firmed 4.2% to A$3.22.
Telstra firmed up 0.3% to A$6.18 after announcing plans to ramp up the amount it spends on phone and internet networks, dishing out $5 billion in the three years to June 2017 to fend off competition from key rivals like Singtel-Optus.
Qantas was up 1.5% to A$3.40 after the consumer regulator gave it interim authorisation for an expansion of its agreement with American Airlines.
China market bounces 5.8% on govt. moves
Mainland China's stock market closed sharply higher in volatile trade, as the regulatory measures to rein in the gyrations seemed to restore investor confidence. China's securities regulator, in its most drastic step yet to arrest a selloff on Chinese stock markets, banned shareholders with large stakes in listed firms from selling for the next six months, while announcing Thursday banks can roll over loans backed by shares. The Shanghai Composite Index jumped 5.76%, or 202.14 points, to 3709.33. It fell as much as 3.81% and rose up to 6.88% during the day, representing a swing of more than 10%. The Shenzhen Composite Index, which tracks stocks on China's second exchange, ended up 3.76%, or 70.90 points, to 1,955.35.
The main Shanghai index had fallen more than 30% since a spectacular bull run peaked on June 12, driven lower by restrictions on margin trading, concerns about overvaluations and "panic" selling by the retail investors that make up the vast majority of the market.
The gains came after China moved to stop major shareholders from selling shares and launched a probe into short-selling in a bid to calm markets. The China Securities Regulatory Commission banned major shareholders, corporate executives and directors from selling stakes in listed companies for six months. Investors with stakes exceeding 5% must maintain their positions in order to maintain capital-market stability amid an “unreasonable plunge” in share prices, the regulator said in a statement.
Eight out of 10 industry gauges in the SSE index jumped, with shares of industrial, consumer-staple and health-care companies were top gainers. China Eastern Airlines Corp., liquor producer Luzhou Laojiao Co. and Beijing Tongrentang Co. all rallied by the 10% limit.
China's consumer price index (CPI), a main gauge of inflation, was up to 1.4% in June from a year earlier, slightly above 1.2-percent rise in May, according to the National Bureau of Statistics data released on Thursday. On a monthly basis, consumer prices in June remained unchanged, compared with a dip of 0.2% posted in May. For the first half of the year, CPI edged up 1.3% year on year. Producer price index, which measures wholesale inflation, slid 4.8% year on year in June, the 40th straight month of declines.
Hong Kong stocks rebound on fresh Beijing support
The Hong Kong stock market advanced for the first time in five straight sessions, as investors chased for bottom fishing on tracking sharp rebound in Mainland China markets after a flurry of rescue measures from the Chinese government to restore investor confidence. The Hang Seng Index rebounded 876.23 points or 3.73% to finish at 24392.79 points, off an intra-day low of 23332.90. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, gained 339.07 points, or 3.05%, to 11446.37 points. Turnover reduced to HK$212 billion from HK$236 billion on Wednesday.
Among HK blue-chips- Hong Kong Exchanges and Clearing, led gains in the Hong Kong blue-chip index, up 14.9% to HK$233.6, followed by China Resources Land up 11.8% to HK$21.55 and China Overseas Land, which was up 10.7% to HK$24.9.
Securities brokers were mostly higher after plunging sharply in recent sessions on concerns over their profitability amid the steep decline in equity markets. Guotai Junan (01788) surged 34% to HK$3.71. Haitong international (00665) leaped 32% to HK$4.8. First Shanghai (00227) shot up 31% to HK$1.41. But Haitong Sec (06837) fell 1% to HK$13.82 after the company said it plans to spend RMB21.6 billion to buy back its own shares.
Chinese banks failed to benefit from today's rally. BankComm (03328) sank 5.3% to HK$7.2. BOC (03988) edged down 0.7% to HK$4.31. CCB (00939) inched down 0.3% to HK$6.37. But ICBC (01398) added 0.4% to HK$5.52.
Sensex slides for 3rd day
Indian stock market ended lower in volatile session of trade. After moving in a narrow range for most part of the day, key benchmark indices dropped to intraday low in late trade led by decline in oil & gas and IT stocks. The S&P BSE Sensex fell 114.06 points or 0.41% at 27,573.66, its lowest closing level since 19 June 2015. The CNX Nifty fell 34.50 points or 0.41% at 8,328.55.
Foreign portfolio investors (FPIs) sold Indian shares worth a net Rs 354.32 crore yesterday, 8 July 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) sold shares worth a net Rs 346.71 crore yesterday, 8 July 2015, as per provisional data.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index fell 0.7% to 8914.13. South Korea's KOSPI rose 0.6% to 2027.81. New Zealand's NZX50 sank 0.5% to 5737.44. Singapore's Straits Times index lost 0.5% at 3267.40. Indonesia's Jakarta Composite index fell 0.7% to 4838.28. Malaysia's KLCI rose 0.3% to 1701.54.
Chinese police and security regulators launched a joint probe into "vicious short-selling" on Thursday. Short selling involves selling an asset the trader does not own in anticipation of a fall in its price. Also on late Wednesday, China's market regulator barred major shareholders and executives of listed companies from selling their shares for the next six months.
Minutes from the most-recent Federal Reserve policy meeting showed the central bank remained cautious about the U.S. economy and raising interest rates. The minutes from the Federal Open Market Committee also warned about the pace of growth beyond the U.S., specifically in China, as well as turbulence that could result from the Greek debt crisis.
Fed officials need to see more signs of a strengthening U.S. economy before raising interest rates, according to minutes of the central bank's June policy meeting. The FOMC minutes likely nudged back the timing of the central bank's first interest-rate increase in nine years toward the end of the year or perhaps even into 2016. Higher U.S. rates would make the dollar more attractive, as they would increase returns on dollar-denominated investments.
Meanwhile, investors continue to monitor developments on Greece's debt crisis. A race to save Greece from bankruptcy and keep it in the euro gathered pace yesterday, 8 July 2015 when Athens reportedly formally applied for a three-year loan and European authorities launched an accelerated review of the request.
International Monetary Fund Managing Director Christine Lagarde yesterday, 8 July 2015 reportedly reiterated that Greece needs debt restructuring as part of a bailout deal, but warned that Athens won't receive special treatment as the government seeks to delay its loan repayments to the IMF.
Greece will submit a detailed reform proposal in the next few days, in a bid to unlock further bailout aid, the country's Prime Minister Alexis Tsipras reportedly told the European Parliament yesterday, 8 July 2015. Referring to his country's resounding "no" in Sunday's referendum, Tsipras stressed the vote wasn't a signal for Greece to break with Europe, but to return to the negotiating table with a stronger mandate.
Following the emergency euro zone summit in Brussels on 7 July 2015, European leaders gave debt-stricken Greece a final deadline of Sunday to reach a new bailout deal and avoid Greece's exit from the euro zone. Representatives of the 19-country euro zone said all 28 European Union leaders would meet on Sunday, 12 July 2015, to decide Greece's fate. Greece's last bailout expired last Tuesday and Greece missed a euro 1.6 billion payment to the IMF.
Among Asian bourses
Nikkei posts modest gain
Japanese share market ended in positive territory after recouping early losses, helped by the share price rebound in China and better than expected core machinery orders. The Nikkei Stock Average rebounded 117.85 points, or 0.6%, to end at 19855.50 points. The Topix index of all Tokyo Stock Exchange First Section issues fell 0.16%, or 2.59 points, to close at 1579.89 points.
Japanese core machinery orders rose seasonally adjusted 0.6% in May over the month, in a sign that domestic firms may be increasing capital spending. The rise was better than a 4.9% fall expected in the median forecast of economists, and came after a 3.8% increase in April.
Machinery orders are often seen as a leading indicator of corporate capital investment, which tends to increase when businesses are planning to expand their operations. The Bank of Japan's latest quarterly "tankan" survey showed that large companies expect to increase capex by 9.3% in the 12 months ending March 2016, a sharp change from the 1.2% cut they said they planned for the year in the previous survey.
Export-related stocks were mostly higher with companies with high exposure to the mainland enjoyed a reprieve in the afternoon session. Komatsu bounced up 1.6%, while Hitachi Construction Machinery closed up 0.4%. Trading giant Itochu Corp. rebounded with a 2.5% rise after slumping 9.2% the prior day, helped by a strong advance in Shanghai shares.
Fast Retailing ended up 4.1%. After the market close, the owner of clothes brand Uniqlo reported a 36% rise in nine-month profit.
Retailer Ryohin Keikaku soared 9.2% after the firm reported a March-May net profit rise of 65% on-year to 6 billion yen and revised up its full-year profit view, Nissan Motor closed down 0.6%, following the company's announcement of an abnormal deployment of an airbag made by Takata.
Australia stocks end flat
The Australian share market closed virtually flat after paring early losses, as a surprisingly rebound in Chinese equities and a better-than-expected employment report buoyed investors' confidence. Most of the ASX sectors closed higher, with gains were leading by Metals & Mining, Materials and Gold blue-chip stocks. The benchmark S&P/ASX 200 Index rose 1.50 points, or 0.03%, to 5471 points, while the broader All Ordinaries Index nudged down 0.20 point to 5456.30 points. The benchmark index entered a technical correction this morning, down 10.2% from its peak of 5,996.9 in April to a trough of 5,383.7 before recovering in the afternoon.
The Australian Bureau of Statistics said on Thursday that Australia's unemployment rate rose to a lower-than-expected 6.0% in June from a downwardly revised 5.9% in May. Economists had expected an unemployment rate of 6.1% in June. The number of people employed rose by 7,300, compared with expectations that the number would remain flat. The number of people in full-time work rose by 24,500 in June, while those in part-time work fell by 17,200. Unemployment has risen as the economy has slowed. The Reserve Bank of Australia expects the unemployment to nudge higher in the next year.
Materials and resources stocks advanced the most in Sydney market as investors chased for bottom fishing following recent slump. Among miners, Shares of BHP Billiton rebounded 1.8% to A$25.88, Rio Tinto 1.7% to A$50.89, and Fortescue Metals Group 6.6% to A$1.785. Western Areas jumped 6.6% to A$3.04, Alumina climbed 4.2% to A$1.48 and Sirius Resources firmed 4.2% to A$3.22.
Telstra firmed up 0.3% to A$6.18 after announcing plans to ramp up the amount it spends on phone and internet networks, dishing out $5 billion in the three years to June 2017 to fend off competition from key rivals like Singtel-Optus.
Qantas was up 1.5% to A$3.40 after the consumer regulator gave it interim authorisation for an expansion of its agreement with American Airlines.
China market bounces 5.8% on govt. moves
Mainland China's stock market closed sharply higher in volatile trade, as the regulatory measures to rein in the gyrations seemed to restore investor confidence. China's securities regulator, in its most drastic step yet to arrest a selloff on Chinese stock markets, banned shareholders with large stakes in listed firms from selling for the next six months, while announcing Thursday banks can roll over loans backed by shares. The Shanghai Composite Index jumped 5.76%, or 202.14 points, to 3709.33. It fell as much as 3.81% and rose up to 6.88% during the day, representing a swing of more than 10%. The Shenzhen Composite Index, which tracks stocks on China's second exchange, ended up 3.76%, or 70.90 points, to 1,955.35.
The main Shanghai index had fallen more than 30% since a spectacular bull run peaked on June 12, driven lower by restrictions on margin trading, concerns about overvaluations and "panic" selling by the retail investors that make up the vast majority of the market.
The gains came after China moved to stop major shareholders from selling shares and launched a probe into short-selling in a bid to calm markets. The China Securities Regulatory Commission banned major shareholders, corporate executives and directors from selling stakes in listed companies for six months. Investors with stakes exceeding 5% must maintain their positions in order to maintain capital-market stability amid an “unreasonable plunge” in share prices, the regulator said in a statement.
Eight out of 10 industry gauges in the SSE index jumped, with shares of industrial, consumer-staple and health-care companies were top gainers. China Eastern Airlines Corp., liquor producer Luzhou Laojiao Co. and Beijing Tongrentang Co. all rallied by the 10% limit.
China's consumer price index (CPI), a main gauge of inflation, was up to 1.4% in June from a year earlier, slightly above 1.2-percent rise in May, according to the National Bureau of Statistics data released on Thursday. On a monthly basis, consumer prices in June remained unchanged, compared with a dip of 0.2% posted in May. For the first half of the year, CPI edged up 1.3% year on year. Producer price index, which measures wholesale inflation, slid 4.8% year on year in June, the 40th straight month of declines.
Hong Kong stocks rebound on fresh Beijing support
The Hong Kong stock market advanced for the first time in five straight sessions, as investors chased for bottom fishing on tracking sharp rebound in Mainland China markets after a flurry of rescue measures from the Chinese government to restore investor confidence. The Hang Seng Index rebounded 876.23 points or 3.73% to finish at 24392.79 points, off an intra-day low of 23332.90. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, gained 339.07 points, or 3.05%, to 11446.37 points. Turnover reduced to HK$212 billion from HK$236 billion on Wednesday.
Among HK blue-chips- Hong Kong Exchanges and Clearing, led gains in the Hong Kong blue-chip index, up 14.9% to HK$233.6, followed by China Resources Land up 11.8% to HK$21.55 and China Overseas Land, which was up 10.7% to HK$24.9.
Securities brokers were mostly higher after plunging sharply in recent sessions on concerns over their profitability amid the steep decline in equity markets. Guotai Junan (01788) surged 34% to HK$3.71. Haitong international (00665) leaped 32% to HK$4.8. First Shanghai (00227) shot up 31% to HK$1.41. But Haitong Sec (06837) fell 1% to HK$13.82 after the company said it plans to spend RMB21.6 billion to buy back its own shares.
Chinese banks failed to benefit from today's rally. BankComm (03328) sank 5.3% to HK$7.2. BOC (03988) edged down 0.7% to HK$4.31. CCB (00939) inched down 0.3% to HK$6.37. But ICBC (01398) added 0.4% to HK$5.52.
Sensex slides for 3rd day
Indian stock market ended lower in volatile session of trade. After moving in a narrow range for most part of the day, key benchmark indices dropped to intraday low in late trade led by decline in oil & gas and IT stocks. The S&P BSE Sensex fell 114.06 points or 0.41% at 27,573.66, its lowest closing level since 19 June 2015. The CNX Nifty fell 34.50 points or 0.41% at 8,328.55.
Foreign portfolio investors (FPIs) sold Indian shares worth a net Rs 354.32 crore yesterday, 8 July 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) sold shares worth a net Rs 346.71 crore yesterday, 8 July 2015, as per provisional data.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index fell 0.7% to 8914.13. South Korea's KOSPI rose 0.6% to 2027.81. New Zealand's NZX50 sank 0.5% to 5737.44. Singapore's Straits Times index lost 0.5% at 3267.40. Indonesia's Jakarta Composite index fell 0.7% to 4838.28. Malaysia's KLCI rose 0.3% to 1701.54.
