RTTNews - The markets across Asia, except Japan, ended in the negative territory on Friday ahead of the key jobs report from the US Labor Department later in the day. Profit taking after the recent rally and concerns about valuations following recent run-up in stocks much too quickly impacted sentiment across the region.
In Japan, the stock market ended in positive territory lifted by late short covering in futures, after having declined sharply in early trading on weak earnings.
The benchmark Nikkei 225 Index ended the session at a new yearly closing high of 10,412, up 24.00 points, or 0.2%, while the broader Topix index of all first section stocks slipped into negative territory with a marginal loss of 0.75 points, or 0.1% at 957.
On the economic front, the Ministry of Finance revealed that the country's international reserves increased to US$1.022 trillion at the end of July, up US$3.48 billion from the previous month. The Ministry further noted that of the total international reserves, foreign currency reserves amounted to US$991.9 billion, while the reserves with the IMF totaled US$4.26 billion. Gold reserves were US$23.1 billion, while the SDRs amounted to US$2.97 billion.
Retail stocks advanced on expectations of recovery. Fast Retailing advanced 0.95%, and Seven & I Holdings rose 1.11%. However, Aeon Co. bucked the trend and slipped 0.43%.
Most of the stocks declined following disappointing earnings on concerns about valuations in the price being inconsistent with their earnings and forecast.
Konica Minolta Holdings, maker of printers and office equipment, reported a 98% drop in first quarter earnings. Following the disappointing results, Nomura Holdings had cut the ratings for the stock to neutral frombuy. The stock declined slumped 10.09%. Among others in the sector, Ricoh fell 1.42% and Terumo Corp. slipped 0.84%.
Kuboto Corp., engaged in the manufacture of farm machinery, reported a 72% drop in earnings for the recent quarter. The stock fell 6.13%. Among other machinery companies, Daikin Industries lost 3.46% and Hitachi Construction Machinery slipped 0.70%.
Automakers also ended weaker on profit taking ahead of key employment report in the U.S later in the day. Toyota Motor declined 0.97%, Honda Motor edged down 0.32% and Nissan Motor lost 1.12%.
Banks also ended in the negative territory on profit taking. Sumitomo Mitsui Financial lost 1.24%, Resona Holdings fell 1.26%, Mizuho Financial edged down 0.44% and Mitsubishi UFJ Financial shed 1.16%.
In Australia, the benchmark S&P/ASX200 Index dropped 26.90 points, or 0.62%, to close at 4,299, and the All-Ordinaries Index ended at 4,303, representing a loss of 27.90 points, or 0.64%.
Releasing the latest quarterly statement on Monetary Policy, the Reserve Bank of Australia noted that the economic conditions have been stronger than expected and is likely to reduce the prospect of further cuts in the benchmark interest rates. The bank said it is still apprehensive about the strength of the global recovery and hinted that it would consider moving towards a more normal setting of the monetary policy by raising the interest from the unusually low 3% at present on signs of sustainable recovery in the economy.
Light sweet crude oil price for September delivery ended at $71.82 a barrel in electronic trading, down $0.12 from its previous close $71.94 a barrel in New York on Thursday.
Metals and mining stocks declined after commodity prices fell sharply in the international market on Thursday. BHP Billiton lost 2.04%, Rio Tinto fell 2.15%, Fortescue Metals slumped 3.00%, Gindalbie Metals shed 2.35%, and Oz Minerals declined 1.37%.
Banks also ended weaker on profit taking and hawkish comments from the Reserve Bank. ANZ Bank slipped 0.47%, National Australia Bank lost 0.97% and Westpac Banking fell 0.44%. However, Commonwealth Bank of Australia bucked the trend and edged up 0.23%.
The third largest insurance company in the country, Suncorp-Metway reported a 39% drop in full year profit for the year ended 30 June, hurt by investment losses. The stock declined 1.25% following the results.
Mixed trading was witnessed among oil stocks. While Santos added 0.27% and Oil Search edged up 0.18%, Woodside Petroleum lost 0.57% and Origin Energy edged down 0.28%.
Gold stocks also witnessed mixed trading. While Lihir Gold lost 1.83% and Newcrest Mining edged down 0.10%, Sino Gold ended in positive territory with a gain of 3.54%.
In Hong Kong, the Hang Seng Index shed 523.87 points, or 2.51% and closed at 20,375 as traders preferred to lock in gains amid concerns that the stocks ran up too fast too quick and not in sync with the underlying earnings. Also, traders preferred to move to sidelines ahead of the key jobs report in the U.S later in the day.
Of the 42 components in the index, only two stocks managed to end in positive territory, with the rest ending in the red, on profit taking.
Resource related stocks fell sharply as commodity prices declined in the international market on Thursday. Aluminum Corp. of China, or CHALCO, slumped 5.24%, PetroChina lost 4.05% and CNOOC fell 3.09%.
Property and banking stocks also ended weaker on valuation concerns.
In South Korea, the benchmark KOSPI Index ended in the positive territory with a gain of 10.96 points, or 0.70% to close at 1,576. Buying interest in financial stocks by foreign institutional investors and expectations of growth lifted the stocks in late trading after investors preferred to lock in gains in early trading ahead of US jobs report.
The Indian market fell sharply for a second day in a row on Friday, as worries that the recent rally outpaced fundamentals led to extensive profit taking amid caution ahead of the looming U.S. jobs report, due later in the day. The BSE Sensex finished at 15,160, down 354 points or 2.28% and the S&P CNX Nifty fell 104 points or 2.27% to close at 4,481.
Among the other major markets in the region, China's Shanghai Composite Index lost 95.64 points, or 2.85% to close at 3,260, Singapore's Strait Times Index shed 52.15 points, or 2.00% to close at 2,549, and Indonesia's Jakarta Composite Index declined 10.84 points, or 0.46% to close at 2,349. The market in Taiwan is closed for a holiday.
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