Shanghai slips after 10-day rally, US data revives rate talk

A local media reports the day’s gain of Japan’s Nikkei stock index in front of an electronic board at Tokyo Stock Exchange in Tokyo on March 12, 2015. Shanghai stocks retreated for the first time in 11 sessions on profit-taking Wednesday but other Asian equity markets were mixed after a healthy batch of US data revived the prospect of an early interest rate hike. AP PHOTO/SHUJI KAJIYAMA

HONG KONG–Shanghai stocks retreated for the first time in 11 sessions on profit-taking Wednesday but other Asian equity markets were mixed after a healthy batch of US data revived the prospect of an early interest rate hike.

The euro edged up marginally as investors were cheered by warmer relations between Greece and Germany as eurozone leaders try to hammer out a reformed bailout deal for Athens.

Shanghai, which surged to a near seven-year high over the past 10 sessions, fell 0.83 percent, or 30.68 points, to 3,660.73.

Hong Kong gained 0.53 percent, or 128.63 points, to 24,528.23. The index was boosted by a rally in Hutchison Whampoa after it said it had agreed to buy British telecom giant O2 for more than US$15 billion.

Tokyo reversed morning losses to end up 0.17 percent, or 32.75 points, at 19,746.20 but Sydney was marginally higher, nudging up 4.23 points to 5,973.32 and Seoul was also flat, edging 1.44 points higher to 2,042.81.

Global investors are keeping a close watch on the United States, looking for any signs that could give an idea of when the Federal Reserve will lift interest rates.

Comments last week from the central bank that the economy still had weaknesses cooled expectations it would announce an increase in early summer.

However, markets took note of news from the Labor Department that inflation hit 0.2 percent in February. That followed three successive months of falling prices, including January’s 0.7 percent drop, which was the steepest since late 2008 during the financial crisis.

Euro stands its ground

Sales of new single-family homes also surged to a seven-year high in February, accelerating for the third consecutive month, the Commerce Department reported Tuesday.

The figures revived talk of an early rate hike, sending the dollar up and US stocks lower.

In Asian currency trade the dollar bought 119.53 yen, compared with 119.77 yen in New York but still up from 119.45 yen earlier Tuesday in Tokyo.

“Traders love a good pullback and as soon as the dollar looks like it’s setting up to resume its bullish trend currency traders will flood the market with trades,” Scott Schuberg, chief executive officer of Rivkin Securities in Sydney, told Bloomberg News.

“We could see continued volatility in foreign exchange markets.”

The Dow dipped 0.58 percent, the S&P 500 fell 0.61 percent and the Nasdaq lost 0.32 percent.

Hopes for a resolution to the long-running Greek debt crisis were raised after the country’s Prime Minister Alexis Tsipras held meetings with German Chancellor Angela Merkel and other officials in Berlin that were said to have gone well.

European officials on Tuesday were hopeful that after months of tough negotiation, common ground could finally be reached with the new anti-austerity Greek government, which swept January elections on a ticket of renegotiating its debt obligations.

The upbeat news continues to support the euro, which bought $1.0990 and 131.37 yen Wednesday, compared with $1.0919 and 130.78 yen in US trade.

Oil prices edged higher. US benchmark West Texas Intermediate fell 38 cents to $47.13 while Brent eased 21 cents to $54.90.

Gold fetched $1,195.51 against $1,191.35 late Tuesday.

In other markets:

— Mumbai fell 0.18 percent, or 49.89 points to end at 28,11.83 points.

National Thermal Power Corporation fell 3.51 percent to 147.25 rupees, while automobile major Tata Motors gained 1.56 percent to 541.20 rupees.

— Singapore rose 0.17 percent, or 5.76 points, to 3,419.02.

Singapore Telecom gained 0.70 percent to Sg$4.32, while real estate developer Capitaland eased 1.11 percent to Sg$$3.55.

— Jakarta ended down 0.77 percent, or 42.16 points, at 5,405.49.

Lender Bank Central Asia gained 0.52 percent to 14,625 rupiah, while state miner Aneka Tambang lost 1.69 percent to 875 rupiah.

— Bangkok closed down 0.11 percent, or 1.65 points, to 1,512.80.

Supermarket operator Big C Supercenter added 2.26 percent to 226 baht, while telecoms operator AIS lost 1.62 percent to 243 baht.

— Wellington fell 0.22 percent, or 12.76 points, to 5,857.78.

Fletcher Building was off 0.80 percent at NZ$8.67 and Air New Zealand was down 0.36 percent at NZ$2.75.

— Taipei slipped 0.66 percent, or 63.83 points, to 9,667.83.

Smartphone maker HTC shed 0.7 percent to Tw$141.0 while Taiwan Semiconductor Manufacturing Co. was 0.33 percent lower at Tw$151.0.

— Manila ended slightly higher, adding 7.40 points to 7,836.34.

SM Investments was down 1.67 percent at 884 pesos, Metrobank added 0.36 percent to 96.70 pesos and Banco de Oro closed 0.83 percent higher at 121 pesos.

— Kuala Lumpur gained 0.28 percent, or 5.06 points, to close the day at 1,819.10.

British American Tobacco Malaysia rose 3.24 percent to end at 70 ringgit and Astro Malaysia Holdings gained 1.89 percent to end on 3.23 ringgit.