Mar 09, 2016
Asia Pacific share market declined on Tuesday, 08 March 2016, as investors took profit from the recent rally after China issued data showing February trade performance was much worse than expected, with exports tumbling the most in over six years.
China's foreign trade continued to slump in February as a result of weak global demand and seasonal factors combined, according to the data from the General Administration of Customs today. Exports lost 20.6% from a year earlier to 821.7 billion yuan (US$126 billion) last month, down from the fall of 6.6% in January by a big margin. In comparison, Imports cut 8% to 612.2 billion yuan, improving from the contraction of 14.4% a month earlier. As a result, trade surplus in February landed at 209.4 billion yuan, a sharp reduction from the surplus of 406.2 billion yuan in January thanks to better performance of imports than exports.
On Monday, China data released after the market close showed foreign currency reserves on the mainland fell to $3.2 trillion at the end of February, dropping from $3.23 trillion the previous month, marking the fourth straight month of declines, although the pace of outflows slowed substantially.
Among Asian bourses
Australia Market snaps five-session run
Australian share market declined for the first time in six sessions in row, due to profit booking across the board, with big miners and banks stocks leading selloff. At the close, the benchmark S&P/ASX200 index declined 34.80 points, or 0.68%, at 5108, while the broader All Ordinaries index dropped 35.20 points, or 0.68%, to 5169.50.
Material and resources and energy stocks ended down. Mining giant BHP Billiton dropped 1.8% to A$18.21 and Rio Tinto declined 2.6% to A$45.26. Fortescue Metals Group ended down 9.4% to A$2.79 after briefly rising 23%, on announcement it has signed a preliminary agreement with Brazilian iron ore giant Vale to pursue iron ore blending and stake sale in the Australian miner. Woodside Petroleum declined 0.3% to A$27.57, Santos 1.8% to A$3.89 and Origin Energy 2.9% to A$5.08.
Shares of retailers were up after the ANZ-Roy Morgan consumer confidence index jumped 3.1% in the week ending March 6, climbing back above its long-term average. Wesfarmers was up 34 cents at A$40.86, while Woolworths lost 2 cents to finish at A$23.
Nikkei drops on strong yen
Japan share market declined for second consecutive session, as a firm yen and concerns about the world's second largest economy triggered profit booking. Every industry category on the main section except textile and real estate issues lost ground led by nonferrous metal, electric power and gas, and banking issues. The 225-issue Nikkei average declined 128.17 points, or 0.76%, to finish at 16783.15. The broader Topix index of all First Section issues on the Tokyo Stock Exchange finished 14.18 points, or 1.04%, lower at 1347.72.
Major Japanese exporters struggled on the back of the yen's strength. A strong yen is a negative for exporters as it usually reduces their overseas profits when converted into local currency. Soy sauce maker Kikkoman Corp, which gets 47% of revenue from North America, dropped 1.9% to 3785 yen. Subaru automaker Fuji Heavy Industries, which relies on North America for 60% of sales, lost 0.5% to 3990 yen. Among other blue chip exporters, Sony Corp dropped 1.7% to 2570 yen and Panasonic Corp 2.8% to 992 yen, meanwhile Toyota Motor Corp dropped 1.8% to 5990 yen, Nissan Motor Co 2.6% to 1091 yen, and Mazda Motor Corp. 2.1% to 1669 yen. Alps Electric Co. sank 3.1% to 2101 yen and TDK Corp 0.7% to 8770 yen.
Japanese automaker Suzuki Motor closed down 3.8% to 2832 yen, following a report that the company will issue 200 billion yen in zero-coupon convertible bonds and use most of the proceeds toward widening its operations in India.
Shares of Japan's Softbank closed up 1.7% to 5851 yen after the company announced reorganization plans to separate its domestic and overseas businesses with separate chief executives. This latest move to boost shareholder value comes after a $4.4 billion share buyback plan announced in February.
China Market ekes out gain
Mainland China stock market ended marginally higher after wiping out initial losses, as traders digested weaker-than-expected trade data from the mainland. Industrial & Commercial Bank of China and PetroChina Co, considered to be targets of government buying because of their large index weighting, were the biggest contributors to gains. Transportation and raw-material companies declined after data showed China's outbound shipments sank last month by the most since May 2009. The Shanghai Composite Index ended up 4.05 points, or 0.14%, at 2901.39. The CSI 300 Index, measuring exchanges in Shanghai and Shenzhen, rose 5.14 points, or 0.09%, to 3107.67.
Shares of transportation companies declined, with China International Marine Containers (Group) Co. down 4.3%, while Spring Airlines Co. dropped 3.2%. Jiangxi Copper Co. and Zijin Mining Group Co. paced losses for material producers, sliding at least 1.8%.
Shares of property developers closed down amid warnings about a housing bubble in top property markets by analysts. Chongqing Mayor Huang Qifan said that China could be headed for a financial disaster if local governments are allowed to keep encouraging home buying with measures such as reducing down-payment requirements. Poly Real Estate Group C fell 1.2% and Gree Real Estate Co sank 1.5%.
Hong Kong Stocks fall on profit taking
The Hong Kong stock market ended down, as profit taking selloff fueled after soggy Chinese trade numbers. China's February trade performance was much worse than economists had expected, with exports tumbling 25.4% from a year earlier and imports sliding 13.8% in dollar-denominated terms. The benchmark Hang Seng Index declined 148.14 points, or 0.73%, to 20011.58 points. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, dropped 121.09 points, or 1.4%, to 8505.22 points. Turnover reduced to HK$62.6 billion from HK$74.9 billion on Monday.
Shares of Macau gaming counters fell across the board on reports that the total full-time employees in the gaming industry reduced 2.7% in 4Q 2015, with the number of dealers falling 4.4%. JP Morgan also said Macau's GGR in the first week in March came in weak. Galaxy Ent (00027) and Sands China (01928) declined 3% and 4% to HK$26 and HK$27.5. Wynn Macau (01128) dropped 4% to HK$9.29.
Wharf (00004) softened 1% to HK$43.3 ahead of its earnings report tomorrow. Goldman Sachs tipped the developer's 2015 core earnings rose 3% to HK$10.7 billion. Hysan Dev (00014) rose 1% to HK$33.7 after it reported a 41% decline in its 2015 net profit.
Indian market settles near the flat line
Losses for banking stocks offset gains for metal shares and index heavyweights Reliance Industries, ITC and HDFC, with the two key benchmark indices settling near the flat line. The barometer index, the S&P BSE Sensex, rose 12.75 points or 0.05% to settle at 24,659.23. The 50-unit Nifty 50 index fell 0.05 points to settle at 7,485.30.
Metal shares edged higher after overnight rally in commodity prices. Shares of oil exploration and production companies rose as global crude oil prices surged. Stocks of most public sector banks (PSU banks) edged lower after Finance Minister Arun Jaitley on Saturday, 5 March 2016, said that an Experts' Group would be constituted immediately to consider a proposal for merger of PSU banks in order to have strong banks.
Bank of Baroda dropped after the Central Bureau of Investigation (CBI) in an announcement dated 6 March 2016 said that it has conducted searches at ten locations in the office/residential premises of certain persons at Delhi/NCR/other places in an on-going investigation of a case relating to alleged violation of banking norms in overseas remittance of foreign exchange of Rs 6000 crore in an illegal and irregular manner from Bank of Baroda's Ashok Vihar, Delhi branch. Syndicate Bank edged lower on media reports that the Central Bureau of Investigation (CBI) is investigating an alleged fraud at the state-run bank involving more than Rs 1000 crore.
Strides Shasun edged higher after the company announced that its wholly owned subsidiary Strides Pharma Inc. has entered into an agreement with Moberg Pharma, Sweden and its affiliates to acquire three OTC brands for a total consideration of $10 million plus inventory value at closing.
Elsewhere in the Asia Pacific region: New Zealand's NZX50 added 0.4% to 6446.72. Taiwan's Taiex index added 0.1% to 8664.31. South Korea's KOPSI fell 0.6% to 1946.12. Malaysia's KLCI fell 0.6% to 1687.86. Singapore's Straits Times index dropped 1.6% at 2778.77. Indonesia's Jakarta Composite index sank 0.4% to 4811.04.
Source: Business Standard