Asian markets turn timid on Tuesday

Nikkei, NZX 50, Sensex finish lower while Hang Seng, Shanghai closes higher

Stock markets in Asian region exhibits a mixed trend on Tuesday, 19 January 2010, as investor's trade cautiously due to lack of significant triggers as stocks on Wall Street were closed yesterday. Though some market finished lower, the losses posted by them was limited as a section of investors are seen going in for stocks at lower levels on expectations of fairly good earnings results for the October-December 2009 quarter.

Japan's Nikkei 225 finished 0.8% lower, Australia's S&P/ASX 200 shed 1%, South Korea's Kospi slipped 0.1% and Taiwan's Taiex gave up 1.1%. China's Shanghai Composite added 0.3%, while Hong Kong's Hang Seng Index finished 1% higher, snapping a five-session losing streak. India's Sensex fell 0.1% and Singapore's Straits Times Index inched up 0.1% in volatile afternoon trading

On Wall Street, stock markets were closed on the account of Martin Luther King, Jr. holiday which celebrated on every third Monday of January in the US.

In the commodity market, crude oil rose for the first time in six days as the dollar weakened and some investors took the view that a drop below $79 a barrel made futures attractive to buy. Crude also gained on a report yesterday China's imports may rise 15% in 2010 as the second-largest energy consumer starts building the second phase of its strategic oil reserves.

Crude oil for February delivery climbed as much as 68 cents, or 0.9%, to $78.68 a barrel in electronic trading on the New York Mercantile Exchange. It was at $78.12 at 3:07 p.m. Singapore time.

Brent crude oil for March settlement was at $76.83 a barrel at 3:08 p.m. Singapore time. It earlier rose as much as 19 cents, or 0.3%, to $77.29 a barrel on the London-based ICE Futures Europe exchange.

Gold rose as the dollar weakened. Gold for immediate delivery rose for a second day to $1,136.60 an ounce.

In the currency market, the U.S. dollar kept a mixed tone in the Asian afternoon Tuesday, ending the session about where it had started the day, with developments in the corporate sector driving sentiment as players waited for the re-opening of U.S. markets.

The Japanese yen strengthened against greenback to one month high on Tuesday on speculation the US economic recovery will slow, prompting the Federal Reserve to keep interest rates near zero to sustain growth, boosted demand for the safe-haven Japanese currency. Japan's currency was quoted at 90.562 per US dollar on Tuesday after touching 1-month high of 90.36 in early trade from yesterday quote at Y90.784 per dollar in New York.

The Hong Kong dollar was trading at HK$ 7.7627 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 trades, the Australian dollar traded within one US cent of a two-month high after prices of commodities, which account for a majority of exports, advanced on speculation global demand will increase. Australia's currency traded at 92.66 US cents as of 12:21 p.m. in Sydney from 92.63 cents yesterday in New York. It rose to 93.28 on 14 January 2010, the strongest since 18 November 2008.

In Wellington trades, the New Zealand dollar briefly stretched above US74c today as non-US dollar currencies got a lift from reports that food company Kraft is likely to lift its bid for Cadbury. The NZ dollar was US 73.84 c at 5 pm from US73.96 cents at 8 am and US73.57c at 5 pm yesterday.

The South Korean won closed at 1127.50 won to the greenback, down from Monday 1,124.50 won.

The Taiwan dollar weakened against the greenback. The Taiwan dollar was trading lower against the US dollar at NT$ 31.8000, 0.0100 up from Monday's close of NT$31.7900.

In equities, Asian markets ended mostly lower in quiet trade as investors awaited key earnings reports from the U.S, with regional chip makers dropping sharply on worries about recent declines in memory-chip prices.

In Japan, the share market continued yesterday decline with the benchmark Nikkei index tumbled further, with steep losses in banks and financials and export related shares. Strengthening yen to 1-month high against greenback weighed down automakers and electronic makers, while cautious ahead of the earning season in the Japan and US taking toll in heavyweight stocks.

At the closing bell, the Nikkei 225 Stock Average index was at 10,764.90, melted 90.18 points or 0.83%, while the broader Topix of all First Section issues on the Tokyo Stock Exchange slid 7.79 points, or 0.81%, to 949.76.

In Mainland China, the stock market continued gains for fourth day in row, helped by financials, materials and resources, and energy-related shares. Materials and resources and energy stocks gained on bargain hunting after the commodity metal and oil prices gained ground. Gains were also supported by expectation of robust corporate earnings, which help to offset weak sentiment from the monetary tightening concerns.

Chinese banking stocks advanced as concerns over monetary tightening eased after comments from the country's banking regulator late Monday. The China Banking Regulatory Commission sent a mobile-phone text message to reporters saying banks will always be required to base their lending on real demand and properly manage the pace and quality of lending. The comments were taken as a response to a report, widely cited by local media, that the CBRC had set new yuan loan quotas for the country's big state-owned lenders.

The advance came although the People's Bank of China raised the yield on its benchmark one-year bills for the second straight week in its open market operation, renewing some concerns about further monetary tightening.

At the closing bell, the Shanghai Composite Index, measuring A shares and B shares on the Shanghai Stock Exchange, climbed 9.77 points, or 0.3%, to 3,246.87, while the Shenzhen Component Index on the smaller Shenzhen Stock Exchange has lost 10.85 points, or 0.08%, to 13,350.67. The CSI 300 Index, measuring exchanges in Shanghai and Shenzhen, rose 0.19%, to 3,507.48.

In Hong Kong, the share market ended black first time in six days, off a morning slumps on broad based bargain hunting across the market heavyweights on attractive valuation following steep sell off in previous five days. Gains were also supported by media report that Beijing may allow individual investors to invest in Hong Kong and other overseas market.

At the end of today's session, the Hang Seng Index has gained 217.97 points, or 1.02%, to 21,677.98, while the Hang Seng China Enterprise, which tracks the overall performance of 43 mainland Chinese state-owned enterprises on the Hong Kong Stock Exchange, jumped 310.50 points, or 2.53%, to 12,600.76.

In Australia, the share market tumbled first time in five days on broad based selling across the sector, exception was information technology which was firmer on profit upgrade by Computershare.

Financials lost ground on profit taking in major banks after strong recent rally. Property trusts slumped in the face of broad losses in the sector. Materials and industrials tumbled as number of sector heavyweight declining into negative territory. A sea of red reflected widespread across major retailers. Information technology shares soared, in the wake of an earnings upgrade by Computershare.

At the closing bell, the benchmark S&P/ASX200 index tumbled 49.90 points, or 1.02%, to 4,861.20, meanwhile the broader All Ordinaries melted 46.50 points, or 0.94%, to 4,889.60.

On the economic front, the Australian Bureau of Statistics said Tuesday that Australia's international merchandise imports rose one % to A$17.66 billion in December, unadjusted, from a revised A$17.55 billion in November.

In New Zealand, the share market fell today as investors continued to take profits and trim positions ahead of the corporate reporting season. The benchmark NZX-50 index closed down 19.512 points, or 0.60%, at 3227.592, after opening down around 8.28 points.

In South Korea, stocks closed down 0.09% after a volatile session as investors dumped tech shares. The benchmark Korea Composite Stock Price Index (KOSPI) lost 1.56 points to 1,710.22, snapping its three-day winning streak.

In Singapore, key stock index finished the choppy session inched up after fluctuating in the boundary most of time due to weak trading across other markets and caution ahead of earnings in the US also impacted market sentiment. Positive closing was mostly attributed to rebound in China and Hong Kong market and firmer commodity metal and oil prices. At the closing bell, the blue chip Straits Times Index was at 2,912.92, edged up 0.90 points or 0.03%.

In Taiwan, stock market in Taiwan tanked on Tuesday to a one-week closing low as major technology firms slipped on investor fears shares may have been overbought following recent gains. The benchmark Taiex share index extended loses in second session, as the index finished day lower by 88.82 points or 1.07% at 8249.82.

In Philippines, equities slipped marginally today as the markets eyed a mixed to bearish activity in the Asian equities. The benchmark index PSEi lost 0.69% or 21.73 points to 3,084.57, while the All Shares index fell 0.53% or 10.45 points to 1,932.23.

In India, the benchmark indices extended losses to hit fresh intraday lows in late trade as weakness in world stocks weighed on investor sentiment. Global stocks fell as investors awaited key earnings reports from the US. Index heavyweight Reliance Industries (RIL) edged lower in volatile trade. IT, realty, auto and healthcare stocks fell. But banking stocks rose. The market breadth was weak. The breadth was strong earlier in the day. The BSE 30-share Sensex was down 155.02 points or 0.88% to 17,486.06. The S&P CNX Nifty was down 49.20 points or 0.93% to 5225.65.

Elsewhere, Malaysia's Kula Lumpur Composite index finished slightly higher at 1300.35 while stock markets in Indonesia's Jakarta Composite index increased by 23.52 points ending the day higher at 2666.07.

In other equities, banks led losses for European shares on Tuesday, offsetting potential deal-inspired gains for chocolate maker Cadbury. Overall, the U.K. FTSE 100 index declined 0.9% or 48.52 points to 5,446, the German DAX index lost 0.8% or 46.99 points to 5,872 and the French CAC-40 index declined 0.73% or 28.94 points to 3,949.