RTTNews - After displaying some strength despite a somewhat cautious start, most Asian markets have drifted down into the red on Tuesday with participants indulging in profit taking after recent rallies. The stock markets in Australia, Hong Kong and Korea were seen trading firm earlier in the day with financial, technology and healthcare stocks garnering attention. However, with no significant triggers in sight, investors appear rather wary of holding positions, and, are in fact seen pressing sales across the board.
The Australian benchmark index S&P/ASX 200, which rose to 3,996, gaining around 26 points, is currently trading at 3,956, down 15 points from its previous close. The broader All Ordinaries index is down 14 points at 3,955.
Energy and material stocks are trading mixed in the Australian market. A few top-notch material stocks, including BHP Billition and Newcrest Mining, are down in the red with sharp losses. However, Rio Tinto and Orica are trading firm with notable gains.
In the energy space, Santos is up in positive territory, while Woodside Petroleum and Origin Energy are trading weak.
Among bank stocks, National Australia Bank is trading weak. Westpac Banking Corporation and ANZ Bank are trading flat, while Commonwealth Bank of Australia is up with a modest gain. Most bank stocks, which had drifted lower after an initial surge, moved off their lows past noon following the U.S. Federal Reserve confirming that most of the major U.S. banks that were ordered to raise capital had developed sufficient plans.
In economic news, a survey by the National Australia Bank revealed businesses felt more upbeat in May on signs of improvement in global financial markets. But the bank's monthly business survey also found that the more positive outlook was yet to translate into improved trading conditions. The survey's measure of business confidence rose 12 index points to minus-two points in May but the measure of business conditions fell four index points to minus-14 points. A reading below zero indicates pessimists outnumber optimists.
In Tokyo, stocks are mostly seen struggling in the red today with investors choosing to take profits after recent strong gains. The Nikkei, which had ended the morning session with a modest loss, is currently down by 82 points or 0.83% at 9,783.
Machinery, insurance and non-ferrous metals stocks declined sharply even as technology, communications and a few automobile stocks displayed some strength.
Sony Corp. has stated that it will raise 220 billion yen by issuing three types of domestic straight bonds. The company, which plans to float 60 billion yen in three-year bonds with a coupon of 0.945%, 110 billion yen in five-year bonds at 1.298%, and 50 billion yen in ten-year bonds that carry a 2.068% coupon, will use the proceeds to redeem older bonds.
Japan's core machinery orders for April will likely rise 0.7% from March, according to the average estimate of 26 private research institutes. The government will release the official data on Wednesday. Should the figure match projections, it will be the first growth in two months. Core machinery orders, excluding those for ships and from electric power companies in light of their amplitude in volume, are considered a leading indicator of corporate investment trends over the coming six months or so.
The U.S. dollar traded at the lower 98-yen level early Tuesday in Tokyo, down slightly from its levels overnight in New York. The yen is currently trading at 98.26 to the U.S. dollar.
In the South Korean market, oil, banking and technology stocks are seen attracting attention. Automobile stocks are trading mixed while steel, airlines and shipbuilding stocks are seen struggling for support.
The Korean index KOSPI, which was trading firm for well over a couple of hours today, is currently down by 15 points at 1,378.
The Hang Seng index of the Hong Kong market is down by as much as 320 points or 1.76% at 17,932. The benchmark had earlier surged to 18,476 this morning following a strong opening.
Among other markets in the Asia-Pacific region, New Zealand and Singapore are down with modest losses, while Taiwan is down sharply in the red with its key index losing nearly 2.3%. The Indonesian market has bucked the trend and is trading modestly higher.
On Wall Street, stocks finished Monday's session little changed despite some spirited buying in the final hour on hopes of a near-term economic recovery. The Federal Reserve continued its treasury buyback program, completing the first of two quantitative easing moves for the week. The New York Fed purchased $7.50 billion worth of securities with maturity dates ranging from December of 2013 to April of 2016.
Meanwhile, President Barack Obama is ramping up the economic stimulus spending, pledging to create over 600,000 jobs this summer. Obama made the announcement Monday morning, stating that he will accelerate the implementation of the $787 billion stimulus in the next 100 days.
The Dow finished up by 1.36 points 8,764.49, while the Nasdaq dipped by 7.02 points to 1842.40, and the S&P 500 fell 0.95 points to 939.14.
In the Asia-Pacific region, markets had finished Monday's session on a mixed note. Japan's benchmark Nikkei 225 Index rose by 1.0 percent, while Hong Kong's Hang Seng closed down by 2.3 percent.
Major European markets finished notably lower. The U.K.'s FTSE 100 Index closed down by 0.8 percent, while the French CAC 40 Index and the German DAX Index fell by 1.5 percent and 1.4 percent, respectively.
Crude oil finished slightly lower amid profit-taking on Monday, but recovered most of its earlier losses. Light sweet crude for July delivery finished at US$68.09 per barrel, down 35 cents on the session. Earlier, oil fell as low as US$66.78 but later climbed as high as US$68.95.
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