RTTNews - Asian markets are exhibiting a mixed trend on Thursday with participants choosing a cautious path ahead of the reporting season. With cues from Wall Street not any significantly positive, investors are seen looking for triggers from the Asian region today.
The Australian market, which rebounded into positive territory after a sharp fall, faltered into the red past noon and is still trading in the red. The benchmark S&P/ASX 200, which fell to 3,741, in the mid-morning session, is currently trading at 3,760, down nearly 8 points from its previous close. The broader All Ordinaries index is down by 8.2 points at 3757.8.
According to a release from the Australian Bureau of Statistics, Australia's unemployment rate reached its higher levels in six years in June, but the outcome was still better than what economists had expected. The unemployment rate came in at a seasonally adjusted 5.8% in June, up from 5.7% the previous month. The country's jobless rate has risen 1.9 percentage points in the past 15 months after hitting a 33-year low of 3.9% in February 2008.
Energy stocks have rallied after a weak start. Healthcare, industrials and consumer discretionary stocks are also mostly trading higher. Consumer staples and utilities are trading weak while financials are exhibiting a mixed trend.
Shares of building materials an sugar giant CSR Limited rallied higher with the company expecting its fiscal 2010 underlying earnings to be slightly higher than last year despite difficult market conditions for its products. The firm, which last month announced plans to demerge its sugar business, said its forecast for annual earnings before interest and tax assumed similar earnings outcomes for its building product and property units.
Delta Air Lines and the Virgin Blue said they plan to form a joint venture that will expand both carriers reach between the US and Australia and the South Pacific. The airlines said in a statement on Thursday that they would seek regulatory approval to form a joint venture, but would collaborate on code sharing, frequent flyer reciprocity and in other areas in the meantime. Virgin Blue Holdings is currently trading nearly 7% up over its previous close.
In Tokyo, stocks extended their losses to a seventh straight session with falling crude oil prices and a stronger yen triggering a sell-off. Caution ahead of key results also weighed in to an extent.
The Nikkei ended the morning session at 9,371.08, down 0.53% or 49.67 points from its previous close. Earlier, after opening at 9,342, the index had slipped to 9,308 on fairly heavy selling across various sectors.
Shares of Mitsubishi Motors rebounded from lower levels and snapped a three-day losing streak on the back of reports that the automaker and PSA Peugeot Citroen Group of France will expand their partnership to develop plug-in hybrid vehicles that can be charged with household outlets. The stock was up with a modest gain at the end of the morning session.
Shares of H.I.S. Co, the firm engaged in travel agency business, rose by about 10% this morning on hopes of strong demand for export trips this summer on the back of yen's solid appreciation against the U.S. dollar. Despite giving up some gains, the stock was still up by over 5% when the morning session ended.
Machinery, auto and bank stocks exhibit weakness. Construction, foods and chemicals stocks are mostly down in the red. Textiles, pharmaceuticals, steel and non-ferrous metals are also trading weak. Insurance stocks are trading mixed.
Sumitomo Metal Mining firmed up after a four-day retreat, buoyed by an overnight rise in Alcoa of the U.S. in after-hours trading. The American firm said Wednesday that it posted an operating loss for the April-June quarter. However, the non-ferrous metal company's sales outperformed market expectations.
Chuo Mitsui Trust Holdings Inc. is extending its recent losses with the June data on corporate bankruptcies released on Wednesday showing the first increase in the number of failures in two months, fueling investor concerns over a possible rise in credit costs. The stock fell to a two-month low this morning and is currently trading nearly 3% down from its previous close.
The sharp fall in crude oil prices took a fairly heavy toll of Japan Petroleum Exploration and Inpex Corp. shares earlier this morning. Though the two stocks have regained some lost ground since then, they are still down in the red, trading lower by 2% and 0.7% respectively.
In the currency market, the U.S. dollar traded in the upper 92 yen range early Thursday in Tokyo, carrying over its weakness from trading in New York overnight, where it had hit a five-month low in the upper 91 yen level on growing pessimism about the global economy. The yen is currently trading at 93.26 to the U.S. dollar.
In the Korean markets, stocks edged higher after a flat start with investors picking up bank, telecom and shipbuilding stocks amid mixed cues from Wall Street.
The benchmark index KOSPI, which opened at 1,429 and rose to 1,443.81 in late morning trade, is currently up with a modest gain of 6 points at 1,437.
The central bank of South Korea, as expected, has keep interest rates steady for a fifth straight month at a record low of 2% amid signs an economic revival and stable inflation. Key bank stocks are all trading sharply higher on strong buying support. KB Financial is trading higher by as much as 5%, Woori Finance is up 4.4% and Shinhan Financial Group is gaining around 3%. Korea Exchange Bank, remaining slightly subdued, is up by close to 1.5% at present.
Shipbuilding stocks, which had a few weak outings in recent sessions, are in demand. Telecom stocks SK Telecom and KT Corp are up in positive territory. Steel makers Hyundai Steel and POSCO are trading modestly higher. Airliners Korean Airlines and Asiana Airlines are trading firm.
Automobile and technology stocks are trading mixed. Oil and energy stocks are trading modestly higher.
Among other markets in the Asia-Pacific region, Hong Kong, Shanghai and New Zealand are trading weak. Indonesia, Singapore and Taiwan markets are trading in positive territory with notable gains. Markets in the region had ended lower on Thursday amid recession worries.
Wall Street ended little changed on Wednesday with traders not evincing any keen interest in taking up positions ahead of the start of the earnings season. The major averages closed on opposite sides of the unchanged mark by slim margins, with the S&P 500 closing modestly lower despite a late-session rally. The Dow closed up by 14.81 points or 0.2% at 8,178 and the Nasdaq rose by 1 point or 0.1% to 1,747, while the S&P 500 fell 1.47 points or 0.2% to 880.
Major European markets also ended the day in the red. The French CAC 40 Index and the U.K.'s FTSE 100 Index fell by 1.3% and 1.1% respectively, while the German DAX Index closed down by 0.6%.
Oil plunged for a sixth straight session and reached its lowest level in seven weeks on Wednesday. Prices dropped on government data that revealed a build in gasoline and distillate fuel supplies in the recent week.
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