RTTNews - Asian markets are exhibiting a mixed trend on Monday with investors making some cautious moves in most of the markets in the region. Cues from Wall Street are slightly positive. However, with some more quarterly results due to hit the market over the next few days, investors in the region appear a bit reluctant to go on a buying spree, and instead, seem keen on lightening commitments at higher levels.
After an early surge and a subsequent fall from higher levels, the Australian market is moving up sharply now due largely to some hectic buying in the financial sector. Energy and materials stocks are seen edging higher after a weak start. Consumer staples, healthcare and utilities stocks are mostly trading lower.
The Australian benchmark index S&P/ASX 200 is currently trading at 4,273, up 28.8 points or 0.7% over its previous close. The broader All Ordinaries index is up by 28.4 points or 0.7% at 4,278.
Australia and New Zealand Banking Group Ltd (ANZ Bank) is trading firm with a sharp 2.5% gain. According to reports, the bank is likely to clinch a deal to buy some Asian assets from British lender Royal Bank of Scotland plc this week. ANZ is expected to pay about A$930 million (US$775 million) for buying RBS's retail and commercial banking operations in six Asian countries.
Other key bank stocks Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corporation are trading higher by 2.7% - 3%. Diversified financials major Macquarie Group is up nearly a percent over its previous close.
Insurance majors Suncorp Metway and QBE Insurance are up by 2.4% and 1.7%, respectively.
Materials stock BHP Billiton has edged up after early weakness. Rio Tinto, despite coming off its lows, is still down in the red. Energy stock Santos is trading modestly higher. Origin Energy is also trading firm. Woodside Petroleum is down by nearly a percent.
Shares of GrainCorp Ltd are up by 6.3% following an upward earnings revision by the company. The company has upgraded its full year profit guidance by up to 50% following increased demand from new bulk wheat exporters. The company said it expects a net profit for the year ending September 30 between A$53 million and A$63 million, up from earlier guidance of a result between A$37 million and A$42 million. GrainCorp made a net loss of A$19.94 million in fiscal 2008, due to drought conditions in Queensland, New South Wales and Victoria. The new guidance released on Monday was the second upgrade in GrainCorp's earnings outlook since it forecast a profit between A$23 million and A$28 million in February.
In the currency market, boosted by encouraging US growth figures, the Australian dollar opened higher today and recorded its strongest start since late September 2008. In early trading, the Aussie was quoting at $US0.8356/60, up from Friday's close of US$0.8278/80. The Australian dollar is currenty trading at 0.8373 to the U.S. dollar.
The Japanese market shrugged off a weak start and rebounded into positive territory in early trading on Monday but faltered subsequently with investors indulging in profit taking after recent strong rallies.
The Nikkei ended the morning session at 10,328, down 0.28% or 28.51 points, but has regained lost ground upon resumption of trade and is down by just 3.74 points or 0.04% at 10,353 at present. Earlier, the index had surged to 10,380.6 after opening at 10,355.
Construction, food and chemicals stocks exhibited a mixed trend. Machinery and non-ferrous metals stocks were also trading mixed in the morning session. Steel stocks are mostly down in the red.
Bank stock Mitsubishi UFJ Financial moved up following the bank reporting a sharp 48% year-on-year jump in net profit to 75.9 billion yen in the April-June quarter, while revenue rose 10% to 191.9 billion yen. The stock was up nearly 5% at the end of the morning session. Resona Holdings, Sumitomo Mitsui Financial, Bank of Yokohama, Mizuho Financial Group, Shinsei Bank and Chuo Mitsui Trust Holdings also edged higher.
Nissan Motor hit a new high for the year and was trading up by about 5% on strong results for the April - June quarter. The unveiling of its electric car 'Leaf' which is to be rolled out in the U.S. and Japan has also triggered hectic buying at the Nissan Motor counter today.
Shares of Credit Saison Co. moved up sharply this morning, extending its gains to a fifth straight session, on the back of reports that Mizuho Financial Group Inc. will likely strengthen its capital and business tie-up with Credit Saison, raising its stake in the credit card player from 10.2% as of the end of June to as much as 14.9%, with voting rights. The stock was up nearly 4% up this morning.
Nitto Denko surged higher and hit a new year-to-date high at 3,170 yen this morning following the company stating that the group net profit will likely fall 33% year-on-year to 12 billion yen in the April-September period, an upward revision from the previous estimate of a 94% decline to 1 billion yen. Amid a recovery in demand for LCD panels, sales of related Nitto Denko materials like optical films have partly recovered, leading to the improved profit picture. A weaker yen is also contributing to the stock's sharp rise.
In the currency market, the U.S. dollar traded at the upper 94-yen level this morning, little changed from its levels in New York late Friday.
After a weak and somewhat listless start, the Korean market has edged higher on strong buying in a few steel, auto, technology and bank stocks.
The benchmark index KOSPI, which had drifted down to 1,555 in early trading, is currently up in positive territory at 1,566, up 8.7 points or 0.57% over its previous close. On Friday, the index had jumped 22.55 points or 1.5% to close at 1,557 after trading between 1,537 and 1,559.
Among automobile stocks, Hyundai Motor and Kia Motor are up by 2.9% and 1.3%, respectively. Ssangyong Motors, which had a couple of bright sessions, is down by nearly 15% today.
In the technology space, LG Display LCD is up by about 2% and LG Electronics is trading modestly higher. Hynix Semiconductor is down with a loss of 1.7%, while market heavyweight Samsung Electronics is down by 0.6%.
Steel stocks Hyundai Steel and POSCO are trading firm. Among bank stocks, Woori Finance and KB Financial are trading modestly higher, while Shinhan Financial is gaining 1.6%. Korea Exchange Bank is down in negative territory with a 0.8% loss.
Among other markets in the Asia-Pacific region, Indonesia, New Zealand and Shanghai are currently trading higher. Hong Kong, which had drifted down earlier in the day, is trading notably higher now. Singapore and Taiwan are exhibiting weakness. Stock markets across the region had finished largely on the upside on Friday.
On Friday, Wall Street ended on a mixed note. While the Dow ended up by 17.15 points or 0.2% at 9,172, the tech-heavy Nasdaq drifted down by 5.80 points or 0.3% to 1,979. The S&P 500 rose 0.73 points or 0.1% to 988.
The GDP report from the commerce department revealed that the U.S. economy continued to shrink by a slower than expected margin, but trader sentiment was hit to an extent as consumer consumption came in far lower than expected.
According to the data, gross domestic product fell at a pace of 1% for the second quarter after economists had expected GDP to fall at a rate of 1.5%. Personal consumption figure showed a decrease of 1.2%, significantly more than what economists had been expecting.
Major European markets closed modestly lower on Friday, with the U.K.'s FTSE 100 index and the German DAX index both finishing down by 0.5%, while the French CAC 40 index dipped by 0.3%.
Crude oil turned sharply higher again on Friday and closed at a four-week high. A better-than-expected U.S. gross domestic product report boosted the outlook for energy demand. Light sweet crude for September delivery surged to US$69.45, up US$2.51 on the session. Prices touched as high as US$69.74 after earlier hitting a low of US$64.96.
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