Asian shares weighed by European woes
HONG KONG—Asian stocks were mixed Wednesday, with Tokyo hitting its highest close since the March 11 quake on optimism over the US outlook, but a cut in Portugal’s debt rating to “junk” tempered sentiment.
A tepid performance on Wall Street, which returned Tuesday from a long weekend, provided little direction.
Tokyo surged 1.10 percent, or 110.02 points, to 10,082.48, its highest finish since March 11 and the first time it has closed above 10,000 since May 2. It also extended to seven days a winning streak on the Nikkei.
Seoul closed 0.44 percent, or 9.44 points, higher at 2,171.19 and Sydney climbed 0.14 percent, or 6.9 points, to 4,605.
However, Hong Kong fell 1.01 percent, or 230.40 points, to 22,517.55 and Shanghai lost 0.21 percent, or 5.88 points, to 2,810.48.
In New York, the Dow fell 0.10 percent after surging 5.4 percent over the previous five sessions, its strongest week in two years.
Moody’s cut its rating on Portugal by four notches to Ba2 Tuesday and warned it could go even lower due to a risk the country might need a second bailout after already receiving 78 billion euros ($112 billion) earlier this year.
It added that the move was also based on rising concerns Lisbon would not meet deficit reduction and debt stabilization targets agreed with the European Union and International Monetary Fund (IMF) for the first bailout.
Moody’s said its main concern was that Lisbon would require a second bailout, just as Greece now does, and that private sector creditor banks would have to take some of the pain.
Tuesday’s cut came a day after another rating agency, Standard & Poor’s, warned that proposals aimed at helping Greece with a new bailout could still amount to a selective default.
Investors had been boosted at the end of last week after Greek lawmakers agreed to a set of austerity measures that allowed the country to receive a handout and avoid a devastating default that many feared could spark another global crisis.
The euro edged down against major currencies in later trade, despite expectations the European Central Bank will raise interest rates when its policy board meets on Thursday.
The single European unit was sitting at $1.4355, down from $1.4418 in New York late Tuesday and at 116.23 yen from 116.92 yen. The dollar fetched 80.96 yen, slightly down from 81.10 yen.
Hopes for the US economy were lifted on Tuesday with the release of data showing signs of a recovery from the supply disruptions caused by Japan’s devastating earthquake and tsunami.
The government said new orders for manufactured goods rose 0.8 percent in May from the previous month, after a 0.9 percent drop in April.
“Excessive concerns about the US economic slowdown are subsiding, but the concerns are still there, so investors want to confirm US jobs data,” Yutaka Miura, a senior technical analyst at Mizuho Securities, told Dow Jones Newswires.
Closely watched monthly US jobs data for June are due out Friday.
Tokyo shares soared as investors bought undervalued stocks amid optimism about manufacturing activity following the earthquake while they were also looking ahead to the start of the earnings season, an analyst said.
Shanghai was down on lingering fears the government will introduce another batch of monetary easing measures soon.
And Hong Kong was hit by a sell-off in Bank of China and China Construction Bank after Singapore sovereign wealth fund Temasek said it was offloading some of its stakes in the lenders.
On oil markets New York’s main contract, West Texas Intermediate for August delivery, rose 75 cents to $97.64 a barrel and Brent North Sea crude for August gained 37 cents to $113.98 in the afternoon.
Gold closed at $1,516-$1,517 an ounce in Hong Kong, up from $1,496.50-$1,497.50 at close on Tuesday.
In other markets:
— Singapore fell 0.48 percent, or 14.98 points, to 3,114.71.
Tiger Airways edged 0.48 percent higher to Sg$1.045 and Singapore Telecom eased 0.63 percent to Sg$3.16.
— Taipei rose 0.46 percent, or 40.00 points, to 8,824.44.
Leading smartphone maker HTC gained 3.3 percent to Tw$1,095 and Taiwan Semiconductor Manufacturing Co was 0.55 percent lower at Tw$72.8.
— Manila fell 0.92 percent, or 40.86 points, to 4,398.75.
Jollibee Foods fell 1.06 percent to 88.90 pesos but San Miguel Corp. rose 2.36 percent to 125.90 pesos.
— Wellington fell 0.37 percent, or 12.76 points, to 3,460.83.
Fletcher Building slid 1.8 percent to NZ$8.41 and Telecom fell 0.6 percent to NZ$2.49, while Air New Zealand was flat on NZ$1.13.
— Jakarta fell 0.39 percent, or 15.17 points, to 3,908.94.
— Kuala Lumpur gained 0.60 percent, or 9.49 points, to 1,591.34.
Malaysian Resources Corp rose 3.6 percent to 2.30 ringgit and Petronas Dagangan added 5.1 percent to 17.16 ringgit.
— Bangkok fell 1.10 percent, or 11.91 points, to 1,072.68.
Banpu lost 10 baht to 720, while PTT fell 8 baht to 339.
— Indian shares ended flat after a rally last week.
The benchmark 30-share Sensex index closed down 17.59 points, or 0.09 percent, to 18,726.97.
India’s largest private bank ICICI Bank fell 1.98 percent, or 21.75 rupees, to 1,075.35 while the second biggest mobile phone firm Reliance Communications fell 2.46 percent, or 2.45 rupees, to 97.25.
