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Market Update

Asia Ends Mostly Lower; Nikkei Plunges 3.8%

Asian markets finished mostly lower Wednesday, following overnight losses at Wall Street, as concerns about an early pullback of the Fed's asset purchase program continued to hurt sentiment.

Japan's Nikkei tumbled 3.7% after the prime minister’s strategy to revitalize the economy failed to impress investors.  Prime Minister Shinzo Abe promised on Wednesday to double inward investment, raise personal incomes by one-third and cut red tape to make his country the best place in the world to do business.

The Shanghai Composite edged down 0.1%, the Hang Seng dropped 1% while Australia's S&P/ASX All Ordinaries lost 1.3%.

Mumbai's Sensex ended a choppy session slightly higher up 0.1%..

Investors took negative leads from U.S. markets where stocks finished lower on Tuesday after Federal Reserve Bank of Kansas City president Esther George reiterated her call to roll back monetary policy stimulus. George added that there was mounting evidence that some of the unintended consequences of the Fed's aggressive stimulus policy are starting to build.

Back in Asia, some economic reports were also in focus. Data released today showed Australia's economy expanded in the first quarter on the back of higher exports.

Meanwhile, China services purchasing managers' index climbed slightly to 51.2 in May as compared with 51.1 in April, a survey conducted by HSBC Holdings revealed Wednesday.

But the HSBC Hong Kong purchasing managers index fell to an eight-month low of 49.8 in May from 49.9 in April as output declined. A reading below 50 indicates contraction while that above 50 indicates expansion in activity.

Stocks on the move

Among exporters in Tokyo, Sharp Corp. tumbled over 7%, Sony Corp. lost more than 5% while Panasonic Corp. retreated 4.3%. Car manufacturer Mazda Motor skidded 5.2%, Toyota Motor reversed 3.4% while Nissan Motor Co. lost 3.8%.

Both brokerage houses Daiwa Securities and Nomura Holdings fell 7.6% each.

Some rare stocks (drugmakers and realty players) in Tokyo that were trading higher ahead of the Prime Minister's address lost gains and pushed lower.

In Hong Kong, property developers extended losses. New World Development Corp. erased 2%, Sino Land Company lost 0.4% and Poly Property Group slipped 1.

Among resources, Angang Steel gave up around 1% while Aluminum Corp. of China dropped over 1%. Oil firms PetroChina and China Petroleum & Chemical Corp. slipped 0.8% and 1.4% respectively.

In the banking sector, ICBC lost 0.4%, China Construction Bank eased 0.8% and Agricultural Bank erased 1.1% after reports said the country's big banks likely extended fewer loans in the month of May.

In Mumbai, stocks opened lower following overseas weakness but pared some of these losses through the session.

Realty firms were in focus today after the cabinet gave a go-ahead to the Realty Regulation Bill.

DB Realty Ltd. fell 2.8%, Housing Development & Infrastructure Ltd. lost 0.2%  but DLF Ltd. recovered early losses to finish 2.7% higher.

Among other gainers, Reliance Industries rose 2.6%, ONGC gained 2%, Sun Pharma climbed 2%, Hindalco Industries added 1.3% and Maruti Suzuki accelerated 1.3%.

In Australia, banks made heavy declines. ANZ tumbled 3.6%, Westpac Banking fell 2.6% and NAB dropped 1.8%.

Miners were mixed -- BHP Billiton and Rio Tinto slipped around 1.4% each but Fortescue Metals Group gained 2.8%. Gold miner Newcrest Mining plunged 6.5% tracking weakness in gold prices overnight.

Billabong International Ltd. plummeted 6.5% extending yesterday's declines after the surfwear retailer ended takeover talks with two potential bidders and said it would now focus of refinancing options instead.