Asia stocks hit by US data as Japan’s PM disappoints
A man walks by an electronic stock board of a securities firm in Tokyo, Wednesday, June 5, 2013. Asian stock markets fell Wednesday as signs the US Federal Reserve might scale back its super-loose monetary policy caused investors to trim equity investments. AP PHOTO/ITSUO INOUYE
HONG KONG—Asian markets fell Wednesday, taking a negative lead from Wall Street as data showed the US trade deficit had widened, while Tokyo slumped again over a policy speech by Japan’s prime minister.
The dollar also fell back below the 100 yen level after Japanese Prime Minister Shinzo Abe came up short of expectations with his economic growth strategy.
Tokyo dived 3.83 percent, or 518.89 points, to 13,014.87—continuing a rollercoaster couple of weeks that has seen the Nikkei lose about 17 percent.
Sydney shed 1.34 percent, or 65.6 points, to 4,835.2 and Seoul gave up 1.52 percent, or 30.32 points, to end at 1,959.19.
Hong Kong lost 0.97 percent, or 216.28 points, to end at 22,069.24 and Shanghai was flat, dipping 1.49 points to 2,270.93.
Abe’s speech on Wednesday outlined more details on his plans to boost growth in Japan’s limp economy but analysts said he failed to ignite interest, with the main points already well-touted ahead of time.
Investors had been waiting for Abe to unveil his “third arrow” to drive growth, after previously announcing huge government spending and a flood of easy money from the central bank.
Among his plans was an aim to lift per-capita income by more than a third in 10 years, a string of deregulation measures and boosting energy investments.
“I didn’t expect much out of this but there wasn’t much indeed,” said Masamichi Adachi, senior economist at JPMorgan Securities Japan.
“There are a series of meaningless figures. I don’t know how they can achieve them,” he told Dow Jones Newswires.
Daisuke Karakama, market economist at Mizuho Corporate Bank, added: “I don’t think it has had such a strong impact. It had nothing new and was in line with what has been reported.”
The market already knew that there would be no drastic measures such as corporate tax cuts, he said.
The dollar—which had been sitting around 100.20 yen in the morning—tumbled to 99.70 yen, compared with 99.98 yen in New York late Tuesday.
In other currency trade the euro was at $1.3076 and 130.40 yen, against $1.3079 and 130.79 yen in New York.
In Washington the Commerce Department said Tuesday that the US trade deficit grew to $40.3 billion in April from $37.1 billion in March as the global economy slows, with key export market Europe mired in recession.
The news adds to ongoing concern about the intermittent US recovery, while traders continue to fret about whether the Federal Reserve will begin to pull back on its monetary easing drive.
“Foreign trade will not provide much of a boost to real GDP growth in 2013,” said Gregory Daco of IHS Global Insight.
“Indeed, subdued global growth should keep exports in check while modest domestic activity limits the pull for imports.”
On Wall Street the Dow lost 0.50 percent, the S&P 500 fell 0.55 percent and the Nasdaq slipped 0.58 percent.
Dealers are now waiting on jobs data Friday, which will provide a clue to the Fed’s next move.
In Sydney investors were reacting to news that Australia’s economy grew 0.6 percent in the first three months of 2013 and 2.5 percent year on year.
The Australian Bureau of Statistics figures came up short of the 0.7 percent and 2.7 percent expected by analysts.
It also follows 0.6 percent quarter-on-quarter expansion in the final three months of 2012 and 3.1 percent on-year, as Australia braces for a bumpy transition away from the key mining sector.
On oil markets New York’s main contract, West Texas Intermediate for delivery in July, added 33 cents to $93.64 a barrel in the afternoon and Brent North Sea crude for July increased two cents to $103.26.
New York’s main contract, light sweet crude for delivery in July, added 31 cents to $93.62 a barrel and Brent North Sea crude for July was up 22 cents at $103.46.
Gold was at $1,397.61 by 1049 GMT from $1,400.22 late Tuesday.
In other markets:
— Taipei fell 0.91 percent, or 9.31 points, to 8,181.91.
Taiwan Semiconductor Manufacturing Co. rose 0.46 percent to Tw$109.5 while PC giant Acer slipped 0.62 percent to Tw$24.05.
— Wellington slipped 0.45 percent, or 20.19 points, to 4,453.59.
— Manila closed 1.73 percent lower, or 115.58 points, at 6,557.89.
SM Investments dived 3.05 percent to 1,017 pesos, SM Prime Holdings lost 1.70 percent to 17.30 pesos and Metropolitan Bank and Trust gave up 2.73 percent to 117.70 pesos.
— Kuala Lumpur declined 2.32 points, or 0.13 percent, to 1,774.42.
CIMB Group lost 1.2 percent to 8.20 ringgit, Malayan Banking shed 0.2 percent to 10.24 while Hong Leong Financial gained 2.3 percent to 15.06.
— Jakarta ended down 0.41 percent, or 20.39 points, at 5,001.22.
Retailer Hero Supermarket rose 8.78 percent to 4,025 rupiah, while paper manufacturer Indah Kiat Pulp and Paper fell 8.50 percent to 1,400 rupiah.
— Bangkok lost 2.12 percent, or 32.95 points, to 1,522.66.
Telecoms company Advanced Info Service dropped 4.73 percent to 262 baht, while Thai Airways International fell 4.58 percent to 31.25 baht.
— Singapore dropped 1.46 percent, or 47.92 points, to 3,243.43.
Real estate developer Capitaland shed 2.29 percent to Sg$3.41 and United Overseas Bank dropped 0.67 percent to Sg$20.78.
— Mumbai rose 0.11 percent, or 22.44 points, to 19,568.22 points.
India’s largest private firm Reliance Industries added 2.56 percent to 800.55 rupees and drug firm Sun Pharmaceutical rose 1.91 percent to 1,038.3 rupees.
