Asian stocks ended mostly lower on Monday after mixed data out of China underscored the fragility of the country's economic recovery. Industrial output rose less than expected, while retail sales growth came in line with expectations, offering very little conviction in the strength of the recovery underway in the world's second largest economy. Fixed asset investment fell to a seasonally adjusted 20.6 percent from 20.9 percent in the preceding month, the National Bureau of Statistics reported.
The weakening of the commodity prices due to the strength of the dollar, which is benefiting from strong U.S. data, and speculation that the Federal Reserve is mulling reducing the amount of bonds that it buys to stimulate the economy also weakened investor appetite for riskier assets.
Japanese shares rallied, helped by the dollar's continued ascent and strong results from companies like Nissan Motor and TDK. The benchmark Nikkei average rose 1.2 percent to its highest level since January 2008, while the broader Topix index advanced 1.8 percent. Sentiment was boosted by the yen's renewed weakness, which fell below the 102 level to the dollar, after the weekend summit of the Group of Seven leading industrialized nations gave a seal of approval to Japan's stimulus policies, saying they are aimed at boosting the domestic economy, which has been mired in stagnation since the 1990's.
Nikon and Fuji Heavy Industries soared 4-5 percent, benefiting from the weaker yen. Nissan Motor jumped 4.5 percent after the company reported a 46 percent jump in fourth-quarter profit and said it is aiming for strong profit growth in the current fiscal. Hitachi climbed 7.8 percent after the electronics company forecast a 20 percent rebound in net profit in the current year. Panasonic shares rallied 7.6 percent as the company forecast a 55 percent jump in operating profit in the year to March 2014. Financials like Dai-ichi Life Insurance, Mitsubishi UFJ Financial Group and Nomura Holdings soared 7-10 percent.
China's Shanghai Composite index slipped 0.2 percent in light trading after state-owned publication China Securities Journal reported that securities regulator may allow new-share sales only in the third quarter. Banks declined after central-bank data showed they cut back on lending in April as compared to the previous month.
Hong Kong's Hang Seng index lost 1.4 percent with shares of Ping An Insurance falling sharply after the China Securities Regulatory Commission imposed a ban on its brokerage unit for helping list a fraudulent Chinese company.
Australian shares ended little changed, as the U.S. dollar's rally against all major currencies weighed on miners. The benchmark S&P/ASX 200 moved in a tight range before closing up 4 points or 0.08 percent at 5,210, a fresh five-year closing high. Big miners BHP Billiton and Rio Tinto fell 0.6 percent and 1.5 percent, respectively, while gold miner Newcrest Mining tumbled 3.8 percent and Perseus Mining lost 7 percent. Banks turned in a mixed performance, with ANZ edging down 0.1 percent and Westpac losing 0.6 percent, while Commonwealth added 0.8 percent and NAB rallied 2.2 percent.
In economic news, home loan approvals in Australia surged the most in four years in March as a series of interest rate reductions by the central bank since 2011 boosted demand for mortgage, the Australian Bureau of Statistics said. The number of owner-occupied dwelling finance commitments rose 5.2 percent year-over-year in March after adjusting to seasonal variations. The number of loans approved for purchase of new dwellings surged 21.1 percent in March following a rise of 0.4 percent in February.
A separate National Australia Bank report indicated a 4 point drop in business confidence in April to a five-month low in the wake of uncertainty over the potential implications of tomorrow's federal budget.
Seoul shares closed little changed as investors fret over the yen's continued weakness beyond the 100-yen mark. The benchmark Kospi average inched up 4 points or 0.2 percent to 1,949. Telecoms stocks ended on a firm note, more than offsetting weakness in shipbuilders and automakers. KT Corp and SK Telecom rose 4-5 percent on defensive buying.
New Zealand shares rose, led by SkyCity Entertainment Group after the Auckland-based casino and hotel company signed a deal to build a $402 million convention centre in exchange for increased gambling concessions. Shares of SkyCity rose 2.3 percent, helping lift the benchmark NZX-50 index up about 0.4 percent to a record high. Chorus, the telecommunications network operator carved out of Telecom, gained 1.1 percent after the company said it has posted growth in broadband connections in the first three months of the year.
On the macroeconomic front, food prices in New Zealand rose a seasonally adjusted 0.2 percent in April from the previous month following the 1.3 percent contraction in March, Statistics New Zealand said. Another report from the Real Estate Institute of New Zealand showed that New Zealand house prices continued to rise in April year-over-year, although prices fell back from a new record hit in March.
India's Sensex was down 1.9 percent after data showed India's trade deficit widened in April to $17.8 billion from $14 billion last year due to a massive surge in gold imports, as retail consumers took advantage of lower prices to buy more gold. Traders are also taking some profits off the table after benchmark indexes Sensex and Nifty closed at their 28-month high during a special trading session on Saturday.
Elsewhere, Indonesia's Jakarta Composite index was down a percent, Singapore's Straits Times was losing 0.3 percent and the Taiwan Weighted average fell 0.4 percent, while Malaysia's KLSE Composite index was up 0.9 percent.
U.S. stocks posted modest gains to close at fresh record highs on Friday amid optimism the U.S. economic recovery is gaining traction. Google led technology stocks higher, offsetting losses in the energy sector. The Dow edged up 0.2 percent, the tech-heavy Nasdaq advanced 0.8 percent and the S&P 500 gained 0.4 percent.
by RTT Staff Writer
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