RTTNews - Stocks are moving in choppy fashion in markets across the Asia-Pacific region on Tuesday with investors not showing any keen interest in going for big purchases due to a lack of significant cues from Wall Street. The mood is cautious in most of the markets in the region ahead of the crucial 2-day U.S. Federal Open Market Committee meeting, beginning Tuesday.
The Australian market shrugged off a weak start and moved into positive territory but fell into the red again due to lack of support at higher levels. Save for some key bank stocks, not many blue chips are seen finding support today. Miners are mostly trading in the red. Energy, consumer staples and healthcare stocks are also trading weak.
The Australian benchmark index S&P/ASX 200 is currently trading at 4,294, down 10 points or 0.2% from its previous close. The broader All Ordinaries index is down by 11.8 points or 0.3% at 4,297.
Commonwealth Bank of Australia, National Australia Bank, ANZ Bank and Westpac Banking Corporation are all trading in positive territory with notable gains.
Miner Rio Tinto is down by about 2.5%. Newcrest Mining and BHP Billiton are also exhibiting weakness.
In economic news, businesses are more confident about the economy than at any time in almost two years, according to a report from the National Australia Bank. The bank's monthly business survey's measure of confidence rose six index points to plus-10 points in July, the highest recording for confidence since August 2007.
The improvement was very broadly based but especially noticeable in construction, wholesaling, transport and manufacturing over recent months, NAB said. The business confidence index had reached minus-30 points in early 2009. Meanwhile, the survey's measure of business conditions rose three index points to plus-one point in July.
In the currency market, the Australian dollar opened lower today with investors taking profits following a recent rally on financial markets. The Aussie, which was quoting at US$0.8367/69 in early trading, down from Monday's close of US$0.8388/90, is currently trading at 0.8340 to the U.S. dollar.
In Tokyo, the Nikkei was up 20.67 points or 0.2% at 10,544.93 at the end of the morning session today. Construction, real estate, pharmaceuticals, chemicals and insurance were mostly trading in positive territory. Automobile, bank and non-ferrous metals exhibited a mixed trend while steel, machinery and electric machinery stocks were seen struggling for support.
Shares in Chubu Electric Power Co. lost ground today after a major earthquake earlier this morning halted the firm's Hamaoka Nuclear Power Plant's No. 4 and No.5 reactors in Shizuoka Prefecture. No radiation leakage has been reported so far. However, if operations remain suspended for an extended period, the firm may be forced to increase thermal power generation, which could lead to higher fuel costs.
Shares of Toshiba Corp. moved up this morning following the firm's announcement the previous evening that it will sell hardware compatible with the Blue-ray Disc format. The company also said it had applied for membership to the Blu-ray Disc Association, which discusses and devises standards for the format. After an early surge, the stock pared some gains and was up just modestly over its previous close at the break.
Transport stock Kintetsu Corp. lost around 3% following the company downgrading its group earnings outlook for the year ending March 2010. The railway operator will likely book a group net profit of 11 billion yen for fiscal 2009, down 32% on the year and 3 billion yen smaller than the previous forecast.
Pharma stock Daiichi Sankyo Co. extended its winning streak to seven days Tuesday, buoyed by hopes for the drugmaker's new anti-influenza agent CS-8958, or laninamivir. On Monday afternoon, the drugmaker said that clinical trials have shown the new treatment to be more effective than Tamiflu, a popular product currently in the market, when administered to children aged nine and under.
In the currency market, the U.S. dollar traded around the 97-yen line early Tuesday in Tokyo, down slightly from its levels in New York overnight. In early trading, the dollar fetched 96.99-97.04 yen against Monday's close of 97.12-22 yen in New York and 97.37-40 yen in Tokyo. The yen is currently trading at 96.94 to the U.S. dollar.
The Korean market is trading flat with investors treading a cautious path due to a lack of prominent triggers. The benchmark index KOSPI is currently trading up 1.3 points at 1,577.4.
Automobile stocks Kia Motor and Hyundai Motor are trading lower even as Ssangyong Motors, enjoying another nice ride up north once again, is up by 15%.
In the technology space, Hynix Semiconductor and LG Display LCD are up modestly, while LG Electronics is trading higher by over 1.5%. Heavyweight stock Samsung Electronics is trading flat.
Among bank stocks, Woori Finance and Korea Exchange Bank are up sharply, while Shinhan Financial and KB Financial are trading around their previous closing prices.
Steel stocks are trading mixed. Oil stocks SK Holdings and S-Oil are down with modest losses. KEPCO is up by over 1%.
In the shipping space, Hyundai Heavy Industries, Samsung Heavy Industries and STX Pan Ocean are trading lower, while Daewoo Shipbuilding is up by 0.7%. Airlines stocks are trading weak, while telecommunications are edging higher.
According to the Chinese statistics bureau, China's industrial output growth accelerated on record loans and stimulus spending. Industrial production climbed 10.8% in July from a year earlier after a 10.7% advance in June. Urban fixed- asset investment for the seven months to July 31 rose 32.9%. Consumer prices fell 1.8% last month.
Among other markets in the region, Shanghai and Hong Kong are trading modestly lower. Taiwan and New Zealand are down with notable losses. Singapore is trading sharply higher, while Indonesia is up slightly over its previous close. Stock markets across the region had largely turned in strong performances on Monday.
On Wall Street, stocks posted modest losses on Monday, as traders cashed in on recent gains amid a lack of significant moves. The decline came ahead of some key economic reports on tap for this week, including data on retail sales, industrial production and weekly jobless claims. Further, the Federal Open Market Committee will make its interest rate announcement on Wednesday, with the key fed funds rate expected to remain unchanged amid a challenging economic environment.
The Dow closed lower by 32.12 points or 0.3% at 9,338, the Nasdaq slipped by 8.01 points or 0.4% to 1,992 and the S&P 500 drifted down by 3.38 points or 0.3% to 1,007.
Major European markets turned in a mixed performance on Monday, with the French CAC 40 index and the German DAX index closing down by 0.5% and 0.8% respectively, while the U.K.'s FTSE 100 index rose by 0.7%.
Crude oil prices finished modestly lower amid choppy trading on Monday, but held above the US$70 per barrel mark. Traders expressed some uncertainty ahead of the Federal Reserve's interest rate decision later this week. Light sweet crude for September moved to US$70.60 a barrel, down 33 cents for the day. Prices touched as low as US$70.09 and as high as US$71.57 earlier in the day.
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