Asian markets mixed after soft Wall Street lead
HONG KONG—Asian markets were mixed on Thursday following a soft lead from Wall Street while a report in China said the country’s central bank would boost liquidity to help kick-start the economy.
The euro rose following a successful debt sale by Spain that eased concerns of a fresh crisis in the troubled eurozone.
Tokyo slipped 0.82 percent, or 78.88 points, to 9,588.38, Seoul fell 0.23 percent, or 4.67 points, to 1,999.86 and Sydney closed 0.32 percent, or 14.0 points, higher at 4,362.7.
Hong Kong rose 1.03 percent, or 214.28 points, to 20,995.01 and Shanghai ended flat, dipping 2.22 points to 2,378.63.
With the eurozone debt crisis back in focus, investors were looking to a sale of Spain’s benchmark 10-year government bonds for an indication of market confidence in the country where unemployment is soaring and output diving.
Asia had rallied on Wednesday after Madrid successfully sold 12- and 18-month debt, albeit at a higher rate.
On Thursday it said it had sold slightly more than its target of benchmark 10-year government bonds and although its borrowing rate rose slightly it was in line with expectations as well as below the critical six percent level.
The euro rose to $1.3132 and 107.02 yen in early European trade, against $1.3120 and 106.59 yen late Wednesday in New York. The dollar firmed to 81.50 yen from 81.23 yen.
Investors are also looking ahead to a G20 meeting on Thursday and Friday that will discuss boosting the International Monetary Fund’s debt-crisis war chest to $500 billion.
“Amid growing concerns over Spanish (debt) financing, the meeting failing to agree on enough expansion of the safety net would put selling pressure on the euro,” said Masafumi Yamamoto, currency strategist at Barclays Capital.
Japan Wednesday pledged $60.0 billion to the fund, saying it was a critical part of the organization’s bid to boost a global firewall against Europe’s debt crisis.
Sweden, Norway, Denmark and Poland are among the nations that have since pledged billions of dollars to the effort, but it was unclear what figure would be settled on at the meeting.
Before Tokyo’s market opened, Japan posted a record 4.410 trillion yen ($54.2 billion) trade deficit for the 12 months to March as car and electronics exports slumped while energy imports soared after the Fukushima nuclear crisis.
The country’s overseas shipments took a hammering last year as the March 11 quake-tsunami as well as floods in Thailand – where many Japanese firms have plants – slammed production, while the European debt crisis cut into demand.
However, figures also showed a deficit of just 82.6 billion yen in March, well below economists’ expectations for a deficit of 223 billion yen.
Wall Street’s main indexes ended in the red as earnings reports, although better than expected, left dealers unimpressed.
The Dow shed 0.63 percent, the broader S&P 500 lost 0.41 percent and the Nasdaq dropped 0.37 percent.
China’s official Xinhua news agency late Wednesday quoted a central bank official as saying it would increase bank liquidity, including through cuts in reserve requirements.
The report comes amid hopes for monetary easing from Beijing as the economy slows and manufacturing stutters in the world’s No. 2 economy.
Official data on Friday showed the economy grew just 8.1 percent in the first three months of the year – well below the 8.9 percent recorded in the last quarter of 2011 – marking the fifth consecutive quarterly slowdown.
“The current situation has provided the conditions to lower reserve requirements, chiefly lower-than-expected economic growth,” Liao Qun, chief China economist for Citic Bank International in Hong Kong, told AFP.
On oil markets, New York’s main contract, West Texas Intermediate crude for delivery in May rose 31 cents to $102.98 per barrel while Brent North Sea crude for June gained 75 cents to $118.72.
Gold was at $1,640 an ounce at 1030 GMT, compared with $1,647 late Wednesday.
In other markets:
— Singapore added 0.25 percent, or 7.63 points, to 3,008.21.
Oversea-Chinese Banking Corp. rose 0.45 percent to Sg$8.95 while vehicle distributor Jardine Cycle and Carriage shed 0.94 percent to Sg$47.45.
— Taipei closed 0.23 percent, or 17.69 points, higher at 7,622.69.
TSMC was 0.94 percent higher at Tw$85.8 while Hon Hai Precision fell 2.31 percent to Tw$105.5.
— Manila closed 0.24 percent or 12.92 points, lower at 5,173.28.
Philippine Long Distance Telephone shed 0.85 percent to 2,550 pesos and Ayala Land dropped 1.5 percent to 21.55 pesos.
— Wellington closed flat, edging up 2.43 points to 3,525.19.
Contact Energy added 0.20 percent to NZ$4.91 and Telecom was unchanged at NZ$2.53, while Air New Zealand was up 1.15 percent at NZ$0.88.
— Kuala Lumpur shed 0.14 percent, or 2.24 points, to 1,596.62.
Financial firm CIMB Group Holdings shed 0.52 percent to 7.63 ringgit, while UEM Land Holdings lost 4.59 percent to 2.08 ringgit. Utility Tenaga Nasional gained 0.61 percent to 6.59 ringgit.
— Jakarta was flat, edging down 2.52 points to 4,163.72.
— Bangkok finished 1.48 percent, or 17.29 points, higher at 1,185.34.
— Mumbai rose 0.64 percent, or 111.32 points, to 17,503.71.
India’s largest passenger car maker Maruti Suzuki rose 3.64 percent to 1,399 rupees while private lender HDFC Bank rose 3.18 percent to 554 after the central bank lowered interest rates for the first time in three years this week.—Dow Jones Newswires contributed to this story
