Asian markets close mixed

Shanghai, Nikkei edge lower while Seoul, Sensex, Sydney inch up higher

Stock market in Asian region turned mixed on Tuesday, 23 February 2010, as investors waited for Federal Reserve chairman Ben Bernanke to shed light on how soon key US interest rates may start to rise. After the surprise increase last week in the rate the Fed charges banks for emergency loans, the market focus is now on how Bernanke explains the move in testimony in the House and the Senate on Wednesday and Thursday.

On Wall Street, stocks closed to the downside Monday, despite gains across the financial sector. The Dow Jones Industrial Average finished lower by 19 points, or 0.2% at 10,383. The S&P 500 fell 1 point, or 0.1%, to 1108 and the Nasdaq shed 2 points, or 0.1%, to 2242.

In the commodity market, crude oil pared losses in New York as the dollar declined against the euro; prompting traders to buy back previously sold contracts.

Crude oil for April delivery was at $80.29 a barrel, down 2 cents, in electronic trading on the New York Mercantile Exchange at 3:36 p.m. Singapore time. Earlier, prices fell as low as $79.73. Yesterday, the March contract rose 0.4% to $80.16 before expiring at the close of floor trading.

Brent crude oil for April settlement was at $78.57 a barrel, down 4 cents, on the London-based ICE Futures Europe exchange at 3:37 p.m. Singapore time. Earlier, it fell as much as 56 cents, or 0.7%. The contract yesterday rose 0.5% to $78.61, the highest settlement since 12 January 2010.

In the currency market, the U.S. dollar was mixed through a calm morning session in Asia Tuesday, as the market caught a whiff of risk aversion and exited risky positions, taking their cue from a morning of losses in regional stocks.

The Japanese yen was strengthened against major counterparts on Tuesday as weaker equities curb appetite for riskier, higher-yielding currencies. The Japan’s currency yen was quoted at 90.98 against the greenback.

The Hong Kong dollar was trading at HK$ 7.7616 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 inched up after a meandering in narrow ranges through the day. At the local close, the dollar was trading at $US0.9015, up 0.1% from Monday’s close of $US0.9006.

In Wellington trades, the New Zealand dollar limped along, barely moving in an absence of major events. The kiwi was worth US70.20c at 5pm today, little changed from US70.26c at the same time yesterday.

The South Korean won ended at 1,148.3 won to the greenback, down 1.3 won from Monday’s close of 1,147.

The Taiwan dollar strengthened against the greenback. The Taiwan dollar was trading higher against the US dollar at NT$ 32.0500, 0.0490 up from Monday’s close of NT$32.0990.

In equities, Asian markets ended mixed with concerns about an impending increase in supply of shares dragging on financial stocks in China, while Hong Kong advanced as investors snapped up property developers.

In Japan, the key indices finished the session slightly lower as a biggest rally in 11 weeks yesterday gave motive to investors to lock in profit while they awaited key US congressional hearings for fresh cues involving US interest rates as well as Toyota Motor Corp’s safety issues. Although, most of losses were trimmed after Asian markets pulled back from early drop. At the closing bell, the Nikkei 225 Stock Average index was at 10,352.10, dropped 48.37 points, or 0.47%. The broader Topix of all First Section issues on the Tokyo Stock Exchange fell 2.38 points, or 0.26%, to 907.37.

In economy section, Japan’s supermarket sales fell 4.9% in January from a year earlier on a same-store basis, marking the 14th consecutive month of year-on-year decline, an industry body said Monday.

Some Bank of Japan policymakers think the financial markets are increasingly focused on the nation’s massive debt and that it has become more important to earn investors’ trust in both fiscal and monetary policies, according to minutes of the central bank’s Jan. 25-26 policy meeting.

In Mainland China, the share market finished the session lower, extending losses for second consecutive day, on lingering concerns over possible further economy-cooling measures near term, with commodity metal producers and financials dragged the most amid falling metal and oil prices and worries possible shares sales will draw liquidity away from existing equities. However, the market off an intraday low as concerns over the rate hike faded.

At the closing bell, the Shanghai Composite Index, measuring A shares and B shares on the Shanghai Stock Exchange, dropped 20.82 points, or 0.69%, to 2,982.57, meanwhile the Shenzhen Component Index on the smaller Shenzhen Stock Exchange slid 144.33 points, or 1.18%, to 12,069.21. The CSI 300 Index, measuring exchanges in Shanghai and Shenzhen, fell 1.07%, to 3,198.52.

In economy section, China's consumer price index (CPI), a main gauge of inflation, would probably only increase moderately in 2010, an official with China's National Bureau of Statistics (NBS) said here on Monday

Although China's CPI continued to climb in previous months, it was not likely to surge this year as supplies were abundant, Wei Guixiang, head of the Department of Urban Social and Economic Survey of the NBS, said Monday during an exclusive interview with xinhuanet.com, a website run by Xinhua.

China's CPI rose 1.5% year-on-year in January, mainly boosted by food price increases due to the cold winter weather. The gauge in January was 0.6% up compared with last December, said the NBS.

China’s exports may grow by 8% in 2010 but problems still existed with getting exports back to pre-crisis levels, according to a statement posted Monday on the website of Ministry of Industry and Information Technology (MIIT), quoting Minister Li Yizhong.

In Hong Kong, the shares surged, boosted by properties shares after higher-than-expected prices at a government land auction and expectation of positive news from the budget tomorrow. Banks and financials and commodities shares spurted as sentiment of the Hong Kong stock market was buoyed. Raising shipping freight rate for fifth day ballooned shipping shares.

At the closing bell, the Hang Seng Index climbed up 245.73 points, or 1.21%, to 20,623, meanwhile the Hang Seng China Enterprise, which tracks the overall performance of 43 Mainland Chinese state-owned enterprises on the Hong Kong Stock Exchange, surged 100.12 points, or 0.87%, to 11,619.68.

In Australia, the shares reversed morning declines to end Tuesday trading session with flat note, as a late swing to the property trusts and financials offset losses in telecom, materials and resources and retailers on falls in commodity prices and disappointing earnings results. Across the market there was a broad mix of gainers and losers as investors digest earnings results and shift their focus to individual stocks over larger macroeconomic influences.

At the closing bell, the benchmark S&P/ASX200 index was up 0.80 points, or 0.02%, to 4,718.30, meanwhile the broader All Ordinaries fell 1.70 points, or 0.04%, to 4,731.

In New Zealand, stock market inched down on Tuesday after advancing for two days in a row. At the closing today, the NZX 50 dipped down 0.11% or 3.39 points to 3126.37. Meanwhile, the NZX 15 decreased 0.17% or 9.4 points to close at 5624.90.

On the economic front, housing confidence is still upbeat even if it’s somewhat tarnished, according to ASB economists. A net 37 % of respondents to the ASB Housing Confidence survey agreed it was a good time to buy a house in the three months ended January 31, compared to a net 48 % in the three months through October. Some 50 % were positive, compared to 59 % in the previous period, and 13 % were negative compared to 11 %.

In South Korea, stocks ended higher as investors snapped up transportation and steel shares, shrugging off jitters ahead of congressional testimony by the chief of the Federal Reserve. After range-bound trading, the benchmark Korea Composite Stock Price Index (KOSPI) rose 1.8 points to 1,628.90.

In Singapore, the shares rose, erasing initial losses as 2010 Singapore Budget were in line with historic precedents and as rebound in Hong Kong shares lure back bargain hunters. Gains were also supported by tracking US index futures, which indicated that the Dow could rise 29 points at the opening bell on Tuesday. At the closing bell, the blue chip Straits Times Index was at 2,782.55, climbed 25.09 points or 0.91%.

In Taiwan, stock market extended gains for the fifth straight session on Tuesday as investors used weakness on Wall Street as an excuse to sell big tech exporters, largely ignoring the island's forecast-beating GDP data for the fourth quarter. The benchmark Taiex share index continued its upward momentum after a stretch of holiday’s as it gained for the fifth straight session after ending the day higher by 37.40 points or 0.49% at 7597.44.

On the economic front, with both exports and private investment expected to score double-digital growth, Taiwan’s economy will advance 4.72% this year, a three-year high. According to the estimates released by the DGBAS, the forecast growth is 0.33 of a percentage point higher than the previous prediction made by the DGBAS last November and the figure may even be able to top 5%, should the cross-Taiwan Strait Economic Cooperation Framework Agreement (ECFA) be inked on schedule. Meanwhile, the unemployment rate slipped further, for the fifth straight month, to 5.68% in January, a one-year low.

In Philippines, stock market closed on a cautious note, with PSEi struggling to stay higher, as investors took cues from the losses on Wall Street overnight, which in turn led investors to sell key heavy weights. The benchmark index is still hovering above the 3000 mark. The gains registered by the financial and the services index however, limited the losses of the PSEi. Furthermore, positive earning report by Manila Electric Company gave some support to investor’s sentiment. At the concluding bell, the benchmark index PSEi declined 0.08% or 2.45 points to 3,013.14, while the All Shares index went up 0.18% or 3.53 points to 1,903.23.

In India, the key benchmark indices provisionally closed with marginal gains after moving in a tight range throughout the day. Gains in world stocks supported the domestic bourses. However, the market breadth was weak indicating a cautious undertone ahead of the Union Budget 2010-2011 later this week. India's largest car maker by sales Maruti Suzuki India fell more than 3% after the company said it has recalled 1 lakh A-star cars to fix fuel leakage problems. The BSE 30-share Sensex was up 49.27 points or 0.30% to 16,286.32. The S&P CNX Nifty was up 13.65 points or 0.28% to 4870.05.

Elsewhere, Malaysia’s Kula Lumpur Composite index finished was little changed at 1266.43 while stock markets in Indonesia’s Jakarta Composite index gained by 19.39 points ending the day higher at 2583.65.

In other regional market, European shares traded mostly lower on Tuesday. The German DAX index declined 0.5% to 5,658.36, the French CAC-40 index lost 0.2% to 3,748.51 while the U.K. FTSE 100 index rose 0.1% to 5,356.56.