News Column

Asian Stocks Rise As US Gauges Hit Record Highs

May 14, 2014

CANBERA (Alliance News) - Asian stocks rose broadly on Wednesday, although underlying sentiment remained cautious due to lack of major triggers and lingering concerns over the situation in Ukraine ahead of the scheduled May 25 presidential election.

Japanese shares fell on profit taking following the previous session's sharp rally. The benchmark Nikkei average slipped 0.1% to 14,406, while the broader Topix Index gained 0.4%. Yokogawa Electric Corp. plunged almost 9% after the company's net income outlook fell short of expectations. Advertising firm Dentsu Inc. tumbled 3.9% after the company forecast profit that missed estimates. JGC Corp shares plummeted 13% after issuing weak guidance for the current fiscal year.

Kubota Corp. jumped 5.9% on better-than-expected financial results. Nippon Telegraph & Telephone Corp. rose 2.2% after reporting its annual results. Publishing house Kadokawa Corp. soared 10% and video distributor Dwango Co. climbed 9% on a Nikkei report that they would merge operations. Nexon rallied 12% after announcing a share buyback. Tech giant Sony, which released its fiscal fourth-quarter earnings after market hours, closed up 1.1%.

In economic news, an index measuring domestic corporate goods prices in Japan rose 2.8% in April from the previous month, the Bank of Japan said, coming in line with expectations.

Chinese shares inched lower, dragged down by cyclical shares on growth concerns. The benchmark Shanghai Composite Index slipped 0.1% to 2,048, while Hong Kong'sHang Seng Index gained a percent to finish at 22,583, a three-week high.

Realty stocks extended gains for the third straight day in Shanghai after China's central bank called on the nation's biggest lenders to speed up approval of mortgage loans. The yuan briefly hit a one-week high after US Treasury Secretary Jacob Lew urged Beijing to renew a pledge to proceed with market-based yuan exchange-rate reform.

Australian shares ended little changed, shrugging off the federal budget announced after market hours on Tuesday. Joe Hockey resorted to aggressive spending cuts and imposed temporary tax on higher income earners in his 2014-2015 budget to shrink the deficit to AUD29.8 billion during the twelve months ended June 2015, from AUD49.9 billion estimated for the current fiscal. The benchmark S&P/ASX 200 slipped 0.03% to 5,496, while the broader All Ordinaries Index edged up 0.01% to 5,476.

National Australia Bank fell 2.6% and Westpac lost 2.7% on going ex-dividend. ANZ shares rose 0.8% while Commonwealth advanced 1.2%. The country's largest lender by market value reported a 16% rise in third-quarter cash earnings, driven by strong revenue growth and cost control.

Rio Tinto edged down 0.1% after the mining giant said its Pilbara iron ore operations in Western Australia reached a run rate of 290 million tons a year, two months ahead of schedule. Fortescue Metals Group fell 1.5%, while BHP Billiton added 0.9% and Newcrest closed marginally higher.

Building products group CSR tumbled 4.8% despite the company returning to an annual profit, versus a net loss of USD150 million in the previous year ended March. Qantas Airways rallied 2.9% on reports it will make dozens of pilots redundant for the first time in history in a bid to contain massive losses.

Seoul shares extended gains for a fifth consecutive session, as foreign investors lapped up tech and auto shares. The benchmark Kospi average jumped 1.4% to finish at 2,011, its highest level since December 30. Overseas investors bought shares worth a net 343.2 billion Korean won after repositioning as net buyers the day before, preliminary data showed. Samsung Electronics added 1.1%, Hyundai Motor climbed 2.6% and Kia Motors rallied 4.4%.

On the economic front, South Korea's export prices dropped 2.5% in April from the previous month after easing 0.4% in March, while import prices declined at the fastest clip in six months, the Bank of Korea said. Another report showed that South Korea's jobless rate rose slightly to 3.7% in April from 3.5% in March, with job growth slowing down for the second consecutive month.

New Zealand shares advanced, helped by positive cues from most regional markets. The benchmark NZX-50 Index rose 0.3% to 5,213. Goodman Property Trust rallied 3% after the country's largest property investor by market value reported a 72% increase in full-year profit, helped by a strengthening economy and rising business confidence.

Online auction site Trade Me Group gained 2.5%, retailer Warehouse Group added 2.1% and cloud accounting software firm Xero closed 1.4% higher, but Ryman Healthcare eased 0.2% ahead of its earnings announcement tomorrow. In economic releases, the volume of total retail sales in New Zealand rose 0.7% in the first quarter of 204, Statistics New Zealand said, missing forecasts for an increase of 0.9% following the upwardly revised gain of 1.4% in the fourth quarter.

India's Sensex was down 0.4% on profit taking after hitting successive record highs in the past three sessions. Elsewhere, the key benchmark indexes in Indonesia, Malaysia, Singapore and Taiwan were up between 0.7% and 1.1%.

US stocks ended a lackluster session mixed overnight after a slew of economic data on retail sales, import prices and business inventories painted a mixed picture of the economy. While the Dow and the S&P 500 posted marginal gains to end at fresh record closing highs, the tech-heavy Nasdaq slid 0.3%.

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Source: Alliance News

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