Asian markets mixed as US data, Europe fears weigh

HONG KONG- Asian shares were mixed in cautious trade Wednesday amid weaker-than-expected US economic data, slumping Japanese corporate earnings and ongoing uncertainty over Europe’s debt crisis.

Markets were broadly unmoved by official data from China showing manufacturing activity improved slightly in January, while a separate study by HSBC showed a continued contraction, albeit at a slower pace.

Tokyo ended flat, edging up 7.28 points to 8,809.79, Seoul rose 0.18 percent, adding 3.45 points to 1,959.24, and Sydney slipped 0.87 percent, or 37.0 points, to 4,225.7.

Hong Kong fell 0.28 percent, or 57.12 points, to 20,333.37 and Shanghai lost 1.07 percent, or 24.53 points, to 2,268.08.

Wall Street was mixed on Tuesday after the Conference Board’s consumer confidence index fell to 61.1 in January from 64.8 a month earlier, showing a downturn in Americans’ hopes for an economic rebound.

The S&P-Case Shiller Index on home prices across the country fell for the fifth straight month in November, despite record-low mortgage interest rates that analysts hoped would help the sector rebound.

The Dow Jones Industrial Average fell 0.16 percent while the broader S&P 500 and tech-heavy Nasdaq were both flat.

Investors have cheered a European Union agreement on stricter controls to maintain balanced budgets across the region, but continued wrangling over a Greek debt writedown has left the public debt crisis still unresolved.

Greek Prime Minister Lucas Papademos has said he hoped to reach a deal with banks “in the coming days” after weeks of complex negotiations aimed at slashing 100 billion euros from the country’s 350-billion-euro debt mountain.

Without a deal, Athens could not tap a second bailout package, keeping alive worries that the country may default on its debt.

“As markets grow thick-skinned to the drawn-out (Greek debt) talks, they still have the potential to cause widespread damage,” Justin Harper, head of research at IG Markets in Singapore, said in a note to clients.

China said its official purchasing managers index (PMI) rose to 50.5 in January, up slightly from 50.3 in December, expanding for the second straight month.

A reading above 50 indicates the sector is expanding while a reading below 50 suggests a contraction.

Markets also reacted to weak Japanese corporate earnings, dented by the March 11 quake-tsunami disaster, a subsequent nuclear crisis and record flooding in Thailand that dented Japanese manufacturers’ supply chains.

Exporters have also been struggling with a high yen, which makes their products more expensive overseas and erodes repatriated profits from foreign operations.

On Tuesday, electronics giant Toshiba reported a 70 percent dive in nine-month earnings, while automaker Honda’s nine-month net profit slumped by almost three-quarters from the previous year.

Australian media stocks were broadly higher after Morgan Stanley bought Fairfax shares totalling 7.6 percent of the company in a raid that Dow Jones Newswires reported as having come from mining billionaire Gina Rinehart.

Fairfax shares soared on the news and closed 10 percent higher.

On currency markets, the euro bought $1.3131 and 99.94 yen in early European trade, compared with $1.3080 and 99.74 yen in New York late Tuesday.

The dollar stood at 76.09 yen from 76.24.

New York’s main oil contract, West Texas Intermediate crude for delivery in March, fell 37 cents to $99.11 a barrel in the afternoon.

Brent North Sea crude for March delivery was up 58 cents to $111.56.

Gold was at $1,745.10 an ounce at 1015 GMT, against $1,736.70 in New York late Tuesday.

In other markets:

— Singapore ended flat, dipping 1.93 points to 2,904.76.

Singapore Airlines was down 1.26 percent at Sg$10.96 and oil-rig maker Keppel Corp lost 2.21 percent to Sg$10.61.

— Taipei rose 0.43 percent, or 32.13 points, to 7,549.21.

HTC rose by its daily 7.0 percent limit to Tw$519.0 while TSMC fell 1.91 percent to Tw$77.0.

— Manila gained 0.71 percent, or 33.20 points, to 4,715.64.

Energy Development Corp. rose 1.61 percent to 5.69 pesos, Metropolitan Bank and Trust surged 4.02 percent to 78.90 pesos and Ayala Corp. gained 3.08 percent to 362 pesos.

— Wellington gained 0.17 percent, or 5.59 points, to 3,301.79.

Telecom, which is expected to post a strong result after spinning off its wholesale arm Chorus last year, rose 2.86 percent to NZ$2.155, while market heavyweight Fletcher Building slipped 1.23 percent to NZ$6.44.

— Jakarta added 0.59 percent, or 23.28 points, to close at 3,964.98.

Among gainers, state-owned lender Bank Rakyat Indonesia rose 2.9 percent to 7,050 rupiah, while food producer Indofood gained one percent to 4,850 rupiah.

— Bangkok rose 0.22 percent, or 2.39 points, to 1,086.36.

— Mumbai rose 0.62 percent, or 107.03 points, to 17,300.58.