Asian stock markets are mostly trading lower on Wednesday with investors treading cautiously following the overnight weak close on Wall Street amid continued uncertainty about the U.S. government's plans to raise the debt limit. Concerns about the European economy too are contributing to the weakness. Some of the markets are off their early lows on modest support, but investors are mostly seen moving away at higher levels.
After a weak start and a subsequent fall, the Australian stock market recovered some lost ground but faltered again due to lack of support at higher levels.
Energy, consumer staples and industrial stocks are finding some support, while financial and mining stocks are trading weak. The benchmark S&P/ASX 200 index, which declined to around 4,550, is currently trading at 4,558, down 15.3 points or 0.3 percent from its previous close. The broader All Ordinaries index is down 15 points or 0.3 percent at 4,631.3.
Among bank stocks, ANZ Bank, National Australia Bank and Westpac are trading weak, while Commonwealth Bank of Australia is up with a modest gain.
In the mining space, BHP Billiton and Rio Tinto are trading notably lower. Orica and Bluescope Steel are also trading weak, while Fortescue Metals, Newcrest Mining and Incitec Pivot are up with modest gains.
Energy stocks Woodside Petroleum, Santos, Origin Energy and Oil Search are trading modestly higher. Caltex Australia is down nearly 2 percent.
Gloucester Coal is gaining 0.6 percent after the company increased its fourth-quarter sales by 16 percent from a year earlier. Total coal production rose to 612,000 tonnes in the three months to June, from 527,000 tonnes a year earlier, according to a report from the company. Coking coal sales rose 11 percent to 239,000 tonnes and thermal coal sales gained 19 percent to 373,000 tonnes.
Australand Property Group has announced that its net profit rose 17 percent in the first half to A$84.78 million. The stock is currently down 0.7 percent from its previous closing price.
Biota Holdings shares are up 1.5 percent after the company said it has received A$6.6 million in royalties for its Relenza flu drug from global pharmaceuticals company GlaxoSmithKline in the 2011 financial year. Biota said GSK had advised it that Relenza sales for the year amounted to A$79.6 million.
Duet Group, Brambles, ResMed and Westfield Group are trading notably lower, while Paladin Energy, QR International, Seek and Goodman Fielder are up with impressive gains.
On the economic front, consumer price inflation in Australia increased at a slightly faster pace than expected in the June 2011 quarter. The Australian Bureau of Statistics reported Wednesday that Q2 CPI increased 0.9 percent on quarter. CPI was up 3.6 percent for the full year through Q2. Most analysts forecast on-quarter CPI to be up 0.8 percent and full year CPI to be up 3.5 percent.
The Reserve Bank of Australia also reported Wednesday that it's Q2 trimmed mean CPI figure was up 0.9 percent on quarter. The RBA's Q2 weighted median was also up 0.9 percent on quarter.
After the data release, the Australian dollar rose to US$1.1028, its highest exchange rate in 30 years.
The Japanese stock market opened weak on heavy selling in several stocks from across various sectors and despite regaining some lost ground subsequently, was still down in negative territory when the morning session ended. A weak dollar and lingering worries about the European economy too weighed on sentiment to a significant extent.
Electric power, automobile, textiles, manufacturing and real estate stocks were among the notable losers. Stocks from foods and pharmaceuticals sections too were mostly trading weak.
The benchmark Nikkei 225 index, which declined to 10,009.4 in early trades, was down 56.7 points or 0.6 percent at 10,041 at the end of the morning session.
Tokyo Electric Power led the decline with a sharp 8 percent slide. Oki Electric was down almost 5 percent, while Kansai Electric Power and Chubu Electric Power were trading lower by 3 percent and 2.6 percent respectively.
Taiheiyo Cement lost over 4 percent. Nippon Electric Glass, SM Trust, Fukuoka Financial, Nippon Steel, Sumitomo Corp., Dai-ichi Life and Mizuho Securities were down 2 to 3 percent.
Credit Saison, Osaka Gas, Asahi Glass, Komatsu, Mitsubishi Electric Corp and Yokogawa Electric were also down with sharp losses.
Among bank stocks, Bank of Yokohama was down by about 2.5 percent. Mitsubishi UFJ Financial, Chiba Bank and Shizuoka Bank were also trading notably lower. Mizuho Financial was also trading weak, while Mizuho Trust & Banking and Shinsei Bank were trading flat.
Among automobile stocks, Hino Motors lost 2.5 percent, dragged down by weak results and profit taking. Nissan Motor, Suzuki Motor, Honda Motor, Mazda Motor and Toyota Motor were down in negative territory with notable losses, while Mitsubishi Motor was bucking the trend and trading slightly up.
Japan Tobacco gained 3.75 percent. Pioneer Corp was trading higher by about 2.5 percent. Nippon Meat Pack, Toho Zinc and Fast Retailing were up with modest gains.
In the currency market, the U.S. dollar traded around 78 yen in early deals in Tokyo. The yen is currently trading at 77.80 to the U.S. dollar.
Among other markets in the Asia-Pacific region, Singapore, New Zealand, Malaysia and Hong Kong are trading modestly lower, while Shanghai, Indonesia and Taiwan are up marginally. Markets across the region closed mostly higher on Tuesday.
On Wall Street, stocks mostly ended lower on Tuesday amid continued uncertainty about the ongoing debt limit debate. An unexpected drop in new home sales too contributed to the decline to an extent.
The major averages all ended in negative territory. The Dow ended lower by 91.5 points or 0.7 percent at 12,501.3, the Nasdaq edged down 2.8 points or 0.1 percent to 2,840 and the S&P 500 closed with a loss of 5.5 points or 0.4 percent at 1,331.9.
Major European markets ended on a mixed note on Tuesday. While the French CAC 40 index lost 0.7 percent, the U.K.'s FTSE 100 index and the German DAX index both edged up by 0.1 percent.
Crude oil prices moved higher on Tuesday with a weak dollar aiding the surge to some extent. Light, sweet crude for September delivery ended up 39 cents or 0.4 percent at $99.59 a barrel on the New York Mercantile Exchange.
by RTT Staff Writer
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