Asian markets edge lower

Sensex, Sydney, Seoul, Hang Seng finish lower while Nikkei advance further

Stock markets in Asian region snapped its recent rally on Thursday, 18 February 2010, despite of a positive close on Wall Street overnight on the back of some encouraging economic reports, the investors turned cautious after companies reported declining earnings and as lower metal prices dragged down mining companies. The key benchmark indices in Indonesia, Hong Kong, Singapore and South Korea were down by 0.38% to 0.89%.

On Wall Street, stocks closed to the upside, lifted by economic data and promising earnings from Deere, and buoyed by the Federal Reserve's minutes from its most recent policy-making meeting. The Dow Jones Industrial Average added 40 points or 0.4% finishing the day at 10,309. The S&P 500 rose 5 points, or 0.4%, to 1100 and the Nasdaq gained 12 points, or 0.6%, to 2226.

In the commodity market, crude oil fell for the first time in three days as the dollar climbed and an industry report showed an increase in U.S. fuel supplies, fanning concern consumption from the world’s biggest energy user may be slow.

Crude oil for March delivery fell as much as 55 cents, or 0.7%, to $76.78 a barrel in electronic trading on the New York Mercantile Exchange. It was at $76.82 at 3:39 p.m. Singapore time. Yesterday, the contract rose 32 cents to $77.33, the highest settlement since Jan. 20. Futures have lost 3% this year.

Brent crude oil for April delivery fell as much as 55 cents, or 0.7%, to $75.72 a barrel on the London-based ICE Futures Europe exchange. It was at $75.74 at 3:42 p.m. Singapore time. Yesterday, the contract gained 0.8% to $76.27, the highest settlement since 20 January 2010.

Gold fell for a second day in London after the International Monetary Fund said it will begin selling bullion from its reserves on the open market. The IMF has 191.3 metric tons left to sell and said it will conduct the on-market sales in a phased manner over time. Prices also slid as the dollar strengthened before a report that may show the index of U.S. leading indicators rose for a 10th month, pointing to an economy that will keep expanding through this year’s first half.

Gold for immediate delivery fell as much as $8.66, or 0.8%, to $1,098.15 an ounce and was at $1,102.15 at 9:15 a.m. London time. The metal dropped 1.1% yesterday after the IMF announcement. Bullion for April delivery was 1.6% lower at $1,102.30 on the New York Mercantile Exchange’s Comex unit.

In the currency market, the U.S. dollar ended in Asia continuing with the mixed performance seen since the morning, with the U.S. currency marking gains versus the euro but losing some ground against the yen.

The Japanese yen was softened against greenback on Thursday. The Japan’s currency yen was quoted 90.86 against the greenback.

The Hong Kong dollar was trading at HK$ 7.7706 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 fell today as plans of the International Monetary Fund (IMF) to sell a portion of its gold holdings lowered commodity-driven currencies. At the local close, the dollar was trading at $US0.8958, down 0.6 per cent from Wednesday’s close of $US0.9012.

In Wellington trades, the New Zealand dollar eased today as the United States dollar rose amid ongoing worries about sovereign debt and on news that the International Monetary Fund (IMF) is selling more of its bullion holdings. The NZ dollar was at US70.05c at 5pm from US70.45c at the same time yesterday.

The South Korean won ended at 1,150.50 won versus the greenback, down 8.30 won from Wednesday's close.

In equities, most Asian markets fell, with Australian shares weaker as Qantas disappointed investors with its first-half results, while miners declined after the International Monetary Fund said it plans to sell gold on the open market.

In Japan, the key indices finished the choppy session higher as firmer defensive shares outweighed profit taking a day after the Nikkei index registered gains in over 2-months. Higher Japan’s futures index also supported gains as US industry production and housing starts exceeded economists’ estimates and the dollar strengthened versus the yen. Broad range of defensive shares rose as resilient in the face of uncertainty overseas.

At the settlement, the Nikkei 225 Stock Average index was at 10,335.69, added 28.86 points, or 0.28%. The broader Topix of all First Section issues on the Tokyo Stock Exchange rose 0.1 points, or 0.01%, to 904.73.

In economic section, the Bank of Japan hold their key interest rates steady at 0.1% as widely expected, while maintaining its assessment on the state of the nation's economy. Foreign investors bought a net 107.1 billion yen of Japanese stocks and 318 million yen of Japanese bonds, while net seller of 2.94 billion yen of money market instruments in the week to 13 February 2010, Ministry of Finance data showed on Thursday. Domestic investors sold a net 1.55 billion yen of Japanese stocks, 4.26 billion yen of Japanese bonds, and 96 million yen of money market instruments in the same week.

In Hong Kong, profit-takers have led the Hong Kong share market down with materials and properties shares among the biggest losers after the previous day's sharp rise, however better than expected US economic data pared declines. At the closing bell, the Hang Seng Index slid 111.86 points, or 0.54%, to 20,422.15, meanwhile the Hang Seng China Enterprise, which tracks the overall performance of 43 Mainland Chinese state-owned enterprises on the Hong Kong Stock Exchange, fell 106.67 points, or 0.91%, to 11,60167.

In Australia, the Australian shares fell as profit taking triggered after the two days of good gains and mixed bag interim earnings reports from companies. Banking and the mining stocks were the biggest drags. Although market losses were limited, helped by firmer Wall Street overnight and on an upbeat economic assessment from RBA. At the closing bell, the benchmark S&P/ASX200 index eased 13 points, or 0.28%, to 4,654.90, meanwhile the broader All Ordinaries has lost 12.90 points, or 0.28%, to 4,673.90.

In economic section, the Reserve Bank of Australia sold a net A$295 million in the foreign exchange market in January. The RBA also bought a net A$365 million in the forex market from the Australian government in January.

The value of total merchandise imported into the country decreased seasonally adjusted A$741 million or 4% to A$16.7 billion in January, the Australian Bureau of Statistic said Thursday. In original terms, imports slid 13% to A$15.39 billion in January from A$17.63 billion in December.

National Australia Bank’s business confidence index rose 2.0 points to 18 for the quarter ended December 2009. The accompanying business conditions index increased by 4 points to 9. The employment sub-index rose 5 points to a score at 1 in December quarter.

In New Zealand, equities gave up its two-day winning streak to end in the negative terrain. The NZX 50 dipped down by 0.30% or 9.29 points to 3101.77. Meanwhile, the NZX 15 decreased 0.25% or 14.24 points to close at 5585.66.

On the economic front, New Zealand consumers are a bit more downbeat this month after data showed unemployment rose to a 17-year high at the end of last year, sapping the elevated optimism of last month. Confidence fell 7.8 points to 123.6 in February, according to the ANZ Roy Morgan Consumer Confidence Survey from a three-year high in January. The current conditions measure fell 10 points to 100 while future conditions index dropped 7 points to 139.

In South Korea, stocks finished lower as investors scrambled to lock in profits after two straight rallying sessions. Snapping the short winning streak, the benchmark Korea Composite Stock Price Index (KOSPI) declined 6.24 points or 0.38% to end at 1,621.19.

In Singapore, the shares were slightly lower with investors took breather after the previous day strong rally as weak Asian market and lower US futures weighed on investor sentiment. At the closing bell, the blue chip Straits Times Index was at 2,769.19, slid 24.87 points or 0.89%.

In Philippines, the stock reversed the early gains, closing below the crucial 3000 mark. At the final bell, the benchmark index PSEi lost 0.62% or 18.73 points to 2,999.94, while the All Shares index tumbled 0.24% or 4.74 points to 1,903.40.

In India, the key benchmark indices fell, snapping last two days' gains as Asian stocks fell and US index futures edged lower. Metal, realty, sugar and auto stocks fell. The BSE 30-share Sensex was down 101.07 points or 0.62% to 16,327.84. The S&P CNX Nifty was down 26.25 points or 0.53% to 4887.75.

On the economic front, food inflation rose for the fourth straight week in early February 2010, heightening worries that it was driving up headline inflation past official forecasts and increasing the chance of the Reserve Bank of India (RBI) pushing up rates. The government data showed the food price index rose 17.97% for the year through 6 February 2010. The fuel price index rose 9.89% while primary articles price index rose 16.23 % for the year through 6 February 2010.

Elsewhere, Malaysia’s Kula Lumpur Composite index finished slightly lower at 1259 while stock markets in Indonesia’s Jakarta Composite index gave up by 21.31 points ending the day lower at 2560.03.

In other regional market, European shares traded in a tight range on Thursday amid a slew of earnings reports, as sharp losses from Societe Generale, Daimler and Akzo Nobel limited upside. Among major European equity markets, the German DAX index gained 0.2% to 5,655, the French CAC-40 index increased by 0.2% or 6.18 points to 3,731 and the U.K. FTSE 100 index spurted 0.4% or 22.12 points to 5,299.