Asian shares lower, Tokyo slides as yen bounces
People walk by an electronic stock board of a securities firm in Tokyo Monday, Dec. 16, 2013. Most Asian markets fell Monday as the Nikkei 225 index slipped 1.6 percent to 15,152.91. AP Photo/Koji Sasahara)
HONG KONG—Asian markets were mostly lower Monday as dealers bet that the US Federal Reserve will announce a cut in its stimulus program at its policy meeting this week.
The dollar slipped in Asia as investors adjusted positions before the meeting, while the yen strengthened.
Despite a Bank of Japan survey of business confidence, which jumped to levels not seen since 2007, Tokyo closed down 1.62 percent, or 250.20 points, to 15,152.91.
Sydney lost 0.17 percent, or 8.8 points, to end at 5,089.6 and Seoul was flat, edging down 1.76 points to 1,961.15.
Shanghai finished 1.60 percent, or 35.21 points, lower at 2,160.86 and Hong Kong gave up 0.56 percent, or 131.30 points, to close at 23,114.66 after a preliminary HSBC survey showed growth in manufacturing activity in China slowed in December.
Trading has largely been driven over the past week by what investors think the Fed will do at its two-day meeting that ends on Wednesday, with opinion split on whether it will begin winding down its bond-buying program this month or early next year.
A series of upbeat figures from Washington—including falling unemployment and strong third-quarter growth—as well as pro-cut comments from Fed officials have made a “taper” seem more likely.
On Wall Street the Dow edged up 0.10 percent and the S&P 500 and Nasdaq were flat Friday despite the approval by the deeply divided US House of Representatives of a budget deal that could avert another government shutdown.
“Investors mainly are waiting to hear the (policy committee’s) assessment of the strength of the US economy, and how that will affect plans for the Fed’s stimulus program,” David Lennox, resource analyst at Fat Prophets in Sydney, told AFP.
Talk of a reduction in the $85 billion-a-month scheme sent the dollar surging last week. It peaked at 103.93 yen on Friday, its highest since late 2008. However, it eased later in the day in New York to settle at 103.23 yen. In Tokyo on Monday it bought 102.86 yen.
The euro—which also hit a five-year high of 142.83 yen against the yen on Friday before falling back—bought 141.45 yen compared with 141.81 yen in New York. The single currency was at $1.3749 from $1.3738.
In Japan the central bank said its Tankan survey had hit a six-year high in the October-December period, underscoring growing optimism among major firms despite a slowdown in the economy.
The report was “positive overall,” said Norinchukin Research Institute chief economist Takeshi Minami.
“It’s not that dramatic as we saw in the previous Tankan, but the latest outcome confirmed sentiment even among small and mid-sized companies is improving,” he added.
Chinese shares were also weighed after HSBC said its purchasing managers’ index (PMI) for manufacturing came in at 50.5 for December, down from a final reading of 50.8 in November and the lowest since September, raising concerns about the sustainability of a recent uptick in the economy.
The index tracks manufacturing activity in China’s factories and workshops and is a closely watched gauge of the health of the economy. A reading above 50 indicates growth, while anything below signals contraction.
“The decline in the flash PMI suggests growth momentum has started to weaken,” Zhang Zhiwei, an economist at Nomura, told Dow Jones Newswires.
In oil trade, New York’s main contract, West Texas Intermediate for January delivery, was down 17 cents at $96.43 in afternoon trade. Brent North Sea crude for January fell six cents to $108.77.
Gold fetched $1,229.05 at 1058 GMT compared with $1,223.09 late Friday.
In other markets:
— Taipei fell 0.75 percent, or 63.07 points, to 8,313.87.
Taiwan Semiconductor Manufacturing Co. eased 0.49 percent to Tw$102.0 and Advanced Semiconductor Engineering was 7.0 percent limit-down at Tw$25.75.
— Wellington rose 0.39 percent, or 18.55 points, to 4,735.61.
Telecom was up 1.73 percent at NZ$2.36 and Air New Zealand was unchanged at NZ$1.64.
— Manila gained 0.79 percent, or 45.41 points, to finish at 5,812.54.
— Jakarta ended down 1.17 percent, or 48.88 points, at 4,125.96.
Palm oil firm Astra Agro Lestari dropped 5.25 percent to 22,550 rupiah, while paper factory Tjiwi Kimia gained 1.11 percent to 1,820 rupiah.
— Kuala Lumpur shed 0.13 percent, or 2.47 points, to 1,837.88.
Malayan Banking lost 0.40 percent to 9.98 ringgit, while Public Bank gained 0.11 percent to 18.52 ringgit.
— Singapore closed down 0.40 percent, or 12.25 points, at 3,053.77.
Oversea-Chinese Banking Corporation was down 0.41 percent at Sg$9.81 while Singapore Airlines rose 0.90 percent to Sg$10.14.
— Bangkok lost 0.95 percent, or 12.73 points, to 1,328.40.
Oil company PTT fell 2.05 percent to 287.00 baht, while Bangchak Petroleum dropped 2.36 percent to 31.00 baht.
— Mumbai ended down 0.27 percent, or 56.06 points, at 20,659.52.
Pharma firm Wockhardt fell 5.43 percent to 337.0 rupees while private carrier Jet Airways lost 4.34 percent to 260.90 rupees.
