Asian stocks closed mixed on Wednesday ahead of the release of some key data, including the U.S and Chinese retail sales for April. While bargain hunting on signs of an early recovery by the global economy helped many markets edge higher, investors pared their long positions at higher levels following unfavorable cues from Wall Street overnight.
Crude oil futures settled higher at $58.85 a barrel, up 0.6% in New York trading on Tuesday after the U.S. dollar fell to a four-month low against a basket of world currencies. Growing optimism that an economic recovery may improve fuel demand also drove crude prices higher. In Asian trading, the commodity extended its gains towards $60 a barrel after the American Petroleum Institute reported an unexpected 3.13 million barrel drop in U.S. crude inventories, suggesting a pick up in demand.
The U.S. markets saw further profit taking on Tuesday, as traders expressed some uncertainty about the outlook for the markets. Investors worried about General Motors being on the verge of filing for bankruptcy after several company executives revealed that they sold their GM stock and liquidated their remaining direct holdings in the company.
After spending a major part of the session in negative territory, the major averages eventually ended the session mixed, with the Dow posting a moderate gain. While the Dow Jones Industrial Average closed up 0.6%, the Nasdaq Composite fell 0.88% and the S&P 500 index closed down 0.1%.
In economic news, the U.S. trade deficit for March came in wider than in the previous month, with the value of exports falling by more than the value of imports. While the report showed that the trade deficit widened to $27.6 billion in March from a revised $26.1 billion in February, economists had expected the deficit to widen to $29.0 billion.
The Japanese market closed modestly higher, as hopes of an early economic recovery more than offset negative sentiment on account of a stronger yen. The benchmark Nikkei 225 index closed at 9,340, up 42 points or 0.45% and the broader Topix index of All First Section issues on the Tokyo Stock Exchanged rose 3 points or 0.4% to 889.
Automakers and exporters closed weaker after the Japanese yen rose to around the 96-yen level against the dollar. Honda fell 1.22%, Suzuki declined 1.21%, Toyota moved down 2.14% and Mazda drifted down nearly 3%. However, Nissan Motor surged up 6.27% after the carmaker forecast a smaller-than-expected operating loss for the fiscal year 2009.
In the technology sector, Advantest fell 2.44%, Tokyo Electron tumbled 4.14%, Kyocera moved down 1.55%, Fanuc slipped 0.63%, Fujitsu declined 1.74% and Sony closed down 1.53%.
Olympus, the world's top endoscope manufacturer, soared 12.83% after the company unexpectedly forecast a return to profit this year. Pioneer Corp fell 3.43%, while Nikon Corp rose 2.85% and Shinsei Bank closed flat ahead of announcement of their fiscal 2008 earnings after the closing bell Wednesday.
The maker of mechanical watches, Citizen Holdings jumped 9.15% after the company forecast a return to profit this business year. Electronics maker Hitachi tumbled 10.76% on a prediction for a loss that was more than double of what analysts had estimated. Shipping stock Mitsui O.S.K. Lines tumbled 4.33% after Nomura Holdings Inc. cut its rating on the stock to neutral from buy.
Among banking stocks, while Mitsubishi UFJ Financial Group fell 2.34%, Mizuho Financial Group rose 0.82% and Resona Holdings gained 0.42%. Insurer Mitsui Sumitomo Insurance advanced 2.54%, Sompo Japan Insurance rallied 4.32% and T&D Holdings ended up 1.82%. Brokerages such as Nomura Holdings and Daiwa Securities also closed stronger.
In economic news, the Economy Watchers Survey released by the Cabinet Office showed that the Japanese current and outlook indices improved further in April. The current index that measures existing economic conditions rose to 34.2 in April from 28.4 logged in the previous month. The indicator stood above the expected level of 30. At the same time, the outlook index moved up to 39.7 from March's 35.8.
In another development, the Teikoku Databank said the number of bankruptcies in Japan stood at 1,169 in April compared to 1,013 cases in the year-ago period, representing an increase of 15.4%. However, it fell 3.9% from 1,216 in March. Total liabilities amounted to 507.44 billion yen in April, down 51.1% from a month before. The amount plunged 30.1% over the previous year.
The Australian market closed lower, as investors digested Tuesday's federal budget. The benchmark S&P/ASX200 index closed at 3,856, down 21 points or 0.54% and the broader All Ordinaries index fell 21 points or 0.55% to 3,842.
Retailer Harvey Norman fell 2.81%, JB Hi Fi slipped 0.23% and Woolworths closed down 0.97%, as investors see a lot less stimulus from the government next year. However, David Jones rose 0.52% and Wesfarmers, which owns Coles, edged up 0.39%.
Commonwealth Bank of Australia rose 0.38% even as it cut its final dividend for the six months ending June by 25%. National Australia Bank slipped 0.64%, ANZ declined 1.63% and investment bank Macquarie Group tumbled 3.07%, but Westpac Banking rose 1.08%
Big-miner Rio Tinto tumbled 4.72% after its American depositary shares plunged 8.4% overnight. According to reports, the company may drop an investment deal with Aluminum Corp. of China for a 5 billion pound ($10 billion) share sale. Iluka Resources also ended down 2.07%, but BHP Billiton rose 0.35%.
Diversified metal company Kagara rose 4.18% after it announced a big resource upgrade for its Red Dome deposit at the Chillagoe gold project in North Queensland. Building and construction stocks such as CSR and Downer EDI rose modestly after Treasurer Wayne Swan's second budget earmarked $22 billion for a nation-building infrastructure program.
Oil and gas producer Santos plunged 8.29% after it raised A$1.75 billion ($1.3 billion) in the heavily oversubscribed institutional portion of its A$3 billion share sale. Woodside Petroleum edged up 0.18%, while Oil Search closed down 0.76%.
Infrastructure and engineering firm AJ Lucas Group plummeted 10.38% on slashing its annual earnings guidance for the 2009 financial year. Property developer Stockland was in a trading halt after it sought as much as $1.98 billion in a capital raising.
Rag trader Pacific Brands surged up nearly 22% after it raised $165 million in an institutional placement. GPT Group rallied 5.95% after rival property trust Stockland Group announced its plans to raise up to A$1.98 billion to help it chase acquisitions.
The South Korean market closed higher on bargain hunting following a loss in the previous session. The benchmark KOSPI closed at 1,415, up 11 points or 0.78%. Volume was significant at 705.97 million shares worth 6.93 trillion won (US$5.56 billion) and advancers outnumbered decliners by 538 to 300.
Shipbuilder Daewoo Shipbuilding closed down 1.63% despite reporting a 23% rise in its first-quarter net earnings. Hyundai Heavy Industries slipped 0.2% and Samsung Heavy Industries fell 2.42%
Technology stocks closed mostly lower. Hynix Semiconductor tumbled 4.12%, LG Electronics fell 3.86% and market heavyweight Samsung Electronics closed down 0.18%, but LG Display LCD ended up 0.96%
Banking stocks closed mixed. Woori Finance declined 1.36% and Korea Exchange Bank closed down 0.35%, but KB Financial, the holding firm of Kookmin Bank moved up 1.94%. Automaker Kia Motors slipped 0.41% Hyundai Motor closed down 0.46% and
Ssangyong Motor slumped 5%.
Among other notable stocks, Oil stock S-Oil moved down 1.28%, telecom stock SK ended down 0.55%, Korean Air Line fell 1.09% and Asiana Air Line drifted down 1.59%, while energy stock KEPCO closed up 0.83% and telecom stock KT rose 1.46%. Oil stock SK and steel maker POSCO closed unchanged.
On the economic front, South Korea's jobless rate edged down to 3.8% in April from 4% in March, the National Statistical Office said Wednesday. The number of unemployed persons decreased to 933,000 in April from 952,000 in the preceding month. At the same time, the number of employed persons increased to 23.5 million from 23.1 million in March.
The New Zealand market closed little changed, as investors looked for direction amid a lack of fresh catalysts. The benchmark NZX-50 closed at 2,812, down 1 point or 0.04%.
Among top stocks, bellwether Telecom rose 1.94%, retailer Warehouse Group closed up 2.37%, transportation company Freightways added 1.32%, energy stock Vector ended up 0.45% and Steel and Tube gained 1.69%
However, power company Contact Energy fell 1.14%, construction company Fletcher Building closed down 0.59%, jeweler Michael Hill tumbled 4.35%, Air New Zealand declined 0.92% and Sky City moved down 2.06%.
Fisher & Paykel Appliances rose 1.56% on expectations that it will be able to restructure its heavy debt load. NZ Oil & Gas gained 2.68% due to firm crude oil price. Property trust AMP NZ Office Trust gained 1.28% and Kiwi Income Property Trust rose 2.15%.
Exporter Sanford fell 1.77% and campervan operator Tourism Holdings tumbled 3.85%, as the kiwi dollar held near a six-month high. Ryman Healthcare advanced 1.25% and Tower ended up 0.61%, while Pumpkin Patch and Pike River Coal closed flat.
Among the other markets in the region, China's Shanghai Composite index rose 1.74%, Singapore's STI Straits Times index gained 0.33% and Taiwan's TWII Weighed index added 0.82%, but Hong Kong's Hang Seng index fell 0.55%. The benchmark for the Indian market, the Sensex was last trading at 12,035, down 123 points or 1.01% from the previous close.
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