Asian markets marks Monday mixed

Sydney, Shanghai, Seoul sinks lower while Sensex, Taiex, NZX 50 travels higher

Stock markets in Asian region closed mixed on Monday, 12 October 2009, as South Korean oil refiners on concern they'll report weaker-than- estimated profits, while shares climbed in Singapore after the country raised its 2009 economic forecast. Investors remained cautious before a string of US earnings reports this week.

On Wall Street, more promising signs for earnings season emerged Friday, topping off a week that took the major averages more than 4% higher for the week. The Dow Jones Industrial Average rose 78.07 points, or 0.8%, to close at a new 52-week high, 9864.94, while the S&P 500 edged up 6.01 points, or 0.6%, to 1071.49. The Nasdaq Composite advanced 15.35 points, or 0.7%, to 2139.28.

Stocks initially opened lower as the dollar firmed after comments by Federal Reserve Chairman Ben Bernanke. The Fed chief, who said accommodative policies will likely be warranted for an extended period, added that at some point, however, as economic recovery takes hold, we will need to tighten monetary policy to prevent the emergence of an inflation problem down the road.

On the economic front, the government said that the deficit narrowed unexpectedly to $30.7 billion in August, down from $31.9 billion the month prior and vs. expectations for an increase to $33 billion.

In the commodity market, crude oil rose for a third day on speculation fuel demand will increase amid signs the global economy is emerging from recession.

Crude oil for November delivery climbed as much as 79 cents, or 1.1%, to $72.56 a barrel in electronic trading on the New York Mercantile Exchange. It was at $72.28 at 12:30 p.m. Singapore time.

Brent crude oil for November settlement rose as much as 56 cents, or 0.8%, to $70.56 a barrel on the London-based ICE Futures Europe exchange. It was at $70.43 a barrel at 11:58 a.m. in Singapore.

Gold, little changed in Asia, may decline as the dollar advanced against global currencies and some investors sold after the metal’s jump to a record last week. Gold for immediate delivery traded at $1,048.30 an ounce at 9:42 a.m. in Singapore, 0.1% lower than the close on 9 October 2009.

In the currency market, the US dollar rose against the yen in Asia Monday, building on gains posted Friday after U.S. Federal Reserve Chairman Ben Bernanke said the Fed is ready to tighten monetary policy once a recovery takes hold in the world's largest economy.

The Japanese yen weakened against major currencies. The Japanese yen was quoted at 90.18 against the greenback compared with 89.83 late Friday in New York.

The Hong Kong dollar was trading at HK$ 7.7501 against the dollar. Actually The Hong Kong dollar is pegged at HK$ 7.8 to the U.S. dollar but can trade between HK$ 7.75 and HK$7.85 to the U.S. dollar.

In Sydney trade, the Australian dollar pulled further from 14-month highs against the US dollar on Monday as investors cut long positions, although expectations that rates at home are headed up helped it hit two-month peaks on the yen. The US dollar extended its bounce in light Asian trade, boosted by Federal Reserve Chairman Ben Bernanke’s comments that monetary policy might have to be tightened as recovery took hold. His comments led to a sell-off in Treasuries with benchmark US government bond yields rising to two-week highs on Friday.

By the local close, the Aussie dollar was at 90.26 US cents, off a 14-month high of 90.92 US cents struck on October 8.

In Wellington trade, the New Zealand dollar continued to weaken today, including against the Australian currency. By local close, the NZ dollar was down to US72.65c from US73.42c at 8am and US73.94c at 5pm on Friday.

The South Korean won finished at 1,170 won to the greenback, down 5.5 percent from Friday's close, after the government told lawmakers that it would take measures to stem the won’s excessive ascent against the dollar.

The Taiwan dollar weakened against the greenback. The Taiwan dollar closed lower against the US dollar at NT$ 32.2900, 0.0500 down from Friday’s close of NT$32.2400.

In the Asian equity market, most major stock markets ended lower, with Hong Kong and Australian shares declining in thin trade as jittery investors locked in profits ahead of a string of key U.S. corporate results

In Japan, stock markets were closed for a holiday.

In Mainland China, share market finished the session lower erasing morning gains inspired from market friendly government steps by major heavyweight materials and energy companies. Refiners and other energy related stocks weighed the most, with Sinopec led the decliners as huge supplies of new shares, including listed stocks coming out after the expiry of lock-up periods.

The Shanghai Composite Index, measuring A shares and B shares on the Shanghai Stock Exchange, fell 17.23 points, or 0.59%, to 2,894.48, while the CSI 300 Index, measuring exchanges in Shanghai and Shenzhen, added 0.38%, to 3,151.63.

On the economic front, China has raised the limit on purchases of local shares by foreign investors by 25% to $1 billion, the government said. The quota for share purchases by so-called qualified foreign institutional investors used to be $800 million, the State Administration of Foreign Exchange said in a statement over the weekend.

In Hong Kong, the stock market ended the session lower with most of sector nosedive in afternoon session after oscillating in and out of boundary in the morning. Resource-related shares dragged the most as investors’ banked profit following strong performance last week. Heavy selling pressure in Sinopec weighed down Energy sector. The Hang Seng Index slid 200.09 points, or 0.93%, to 21,299.35, while the Hang Seng China Enterprise shed 120.13 points, or 0.96%, to 12,375.93.

In Australia, the share market finished the trading session in southward direction despite opening in positive terrain as investors elected to banked profit amid cautious about chasing the market higher after a strong previous week. Most of the stocks ended in diverse terrain. At the closing bell, the benchmark S&P/ASX200 index slid 13.1 points, or 0.28%, to 4,739.8, meanwhile the broader All Ordinaries has shed 9 points, or 0.19%, to 4,745.5.

On the economic front, the Australian Bureau of Statistics said in a statement that housing finance for owner occupation dropped a seasonally adjusted 1.7% month-on-month in August. Owner occupied housing commitments decreased to A$16.54 billion from A$16.83 billion in the preceding month. At the same time, personal finance rose 4.1% to A$7.18 billion, and commercial finance increased 5.6% to A$28.51 billion. However, lease finance fell 9.4% to A$398 million, all in seasonally adjusted terms.

In New Zealand, benchmark index commence the first trading day of the week in the positive region after edging down Friday. The New Zealand share market started the week strong, with leading stocks recovering some ground lost. Technology stocks in the region were higher, tracking gains for U.S. tech heavyweights. As per the provisional figures at the closing bell, the NZX50 advanced 0.49% or 15.63 points to 3178.88. The NZX 15 was up 0.37% or 21.36 points to close at 5761.12.

On the economic front, New Zealand's house prices fell at a slower yearly rate of 1.1% in September compared to the 2.8% decline in the previous month. The government agency reported that prices were up 2.7% since April, and the national average sale price also increased to NZ$387,567 in September from NZ$385,426 in August.

In South Korea, stocks closed lower Monday as foreign and institutional investors booked profits following last week's rallies. The benchmark Korea Composite Stock Price Index (KOSPI) dropped 6.98 points to 1,639.81, ending two days of gains.

In Singapore, stock market extended winning streak for sixth consecutive trading day, buoyed by positive lead from international markets over the weekend. Shares of banks and properties outperformed as better than expected GDP data strengthening optimism about the global economic outlook, meanwhile gains from major manufacturing and other blue chip stocks also supported the rally. The blue chip Straits Times Index was ended at 2,680.47, gained 27.96 points or 1.05%.

On the economic front, the government of Singapore sharply upgraded its economic outlook for 2009 Monday, as the city-states gross domestic product continued to expand at a rapid clip in the third quarter amid an improvement in manufacturing activity. It now expects the economy to contract by just 2.5% to 2% from the previous year - a sharp improvement over its previous forecast of a decline of 6% to 4% - but remained cautious about a full-scale recovery.

In Taiwan, stock market finished higher for second straight sessions, collecting about 100 points in last two sessions, ending just below the 7,600-point plateau. Construction and cement sector drove the index higher while financials fail to carry the charm. The benchmark Taiex share index stretched its winning streak over the weekend by ending the first day of the week higher by 27.92 points or 0.37% in a day, closing the day at 7599.88.

On the economic front, Taiwan’s exports to China and Hong Kong edged up 0.3% from a year earlier to US$8.22 billion in September, marking the first positive growth of its kind in 12 months.

According to the statistics released by the Ministry of Finance (MOF), Taiwan’s total exports amounted to US$19.07 billion in September, up US$60 million from a month earlier but down 12.7% from a year earlier. China and Hong Kong together absorbed 43.1% of Taiwan’s total exports, the highest between Taiwan’s export outlets.

In Philippines, equities closed lower as selling pressure emerged after the market consolidated in a range in last week. The markets failed to edge up despite the global cues providing with not to bearish leads. At the final bell, the benchmark index PSEi lost 0.40% or 11.81 points to 2,930.97, while the All Shares index fell 0.24% or 4.49 points to 1,846.27.

In India, the key benchmark indices surged after the latest data showed a surge in industrial output in August 2009. A strong response to initial public offer of India bulls Power, which was fully bid within half an hour of opening of the issue also lifted sentiment. The BSE 30-share Sensex was up 384.01 points or 2.31% to 17,026.67. The S&P CNX Nifty was up 109.05 points or 2.21% to 5,054.25.

On the economic front, the industrial production (IIP) rose a robust 10.4% in August 2009. It is the fastest pace of growth in 22 months. Manufacturing output rose 10.2%. The government revised upwards-industrial production growth for July 2009 to 7.2% from an earlier estimated 6.8%.

Elsewhere, Malaysia's Kula Lumpur Composite index went down 0.04% or 0.49 points to 1233.33 while stock markets in Indonesia’s Jakarta Composite index ended the day lower at 2456.69.

In other regional market, European shares rose on Monday, as a surprise profit from Dutch conglomerate Philips Electronics helped boost sentiment at the start of the week. The German DAX index rose 1.4% or 81.47 points to 5,793, the U.K. FTSE 100 index rose 1.1% or 56.43 points to 5,218 and the French CAC-40 index climbed 1.2% or 46.33 points to 3,846.