Asia Stocks Sink; Ex-Dividend Trade Hits Tokyo
Asia markets fell on Wednesday with sharp losses in Tokyo as many firms started to trade without rights to the latest dividend payouts, while global growth fears hit resource shares across the region.
Japan’s Nikkei Stock Average tumbled 1.5%, while South Korea’s Kospi and Australia’s S&P/ASX 200 index each shed 0.4%.
Hong Kong’s Hang Seng Index declined 0.7%, while China’s Shanghai Composite was little changed.
“It appears as though the impact of recent central bank announcements is fading fast to be replaced by renewed global growth fears and yet more concerns about the lack of traction in delivering solutions to the fiscal crisis in Europe,” Credit Agricole strategist Mitul Kotecha said.
The performance in Asia follows a downbeat session in the U.S., as criticism from a non-voting Federal Reserve member about the central bank’s latest round of monetary easing overshadowed solid economic data. Quarter-end positioning after recent strong gains also contributed to the falls, according to traders. Read more on the U.S. session.
Major movers
In Tokyo, shares were pressured as most major names traded ex-dividend.
Among those losing ground, Advantest Corp. slumped 2.7%, and Honda Motor Co. tumbled 3.1% after Deutsche Bank cut its rating on the stock to hold from buy.
Rival auto makers were better supported amid a Nikkei report that Toyota Corp. and Nissan Motor Co. will reduce production in China as escalating anti-Japan sentiment hurts sales.
Toyota shares fell 0.6% and Nissan rose 1.9%, after also saying late Tuesday that it will introduce 10 new models in India by March 2017.
A stronger yen provided another headwind for Japanese exporters. Canon Inc. sank 3.7% and Casio Computer Co. dropped 1.9%.
Shares of Sharp Corp. outperformed with a 1% gain, after the Nikkei reported lenders are expected to approve funding that will enable the firm to stay afloat through the current fiscal year.
Also on the upside, Mitsubishi UFJ Lease & Finance Co. rose 0.7% following reports the company will buy American aircraft-leasing firm Jackson Square Aviation for around 100 billion yen ($1.28 billion).
In Hong Kong, financial firms were among the main drags. Major index component HSBC Holdings PLC dropped 1.2% and shares of AIA Group Ltd. fell 2.2%.
Automakers were other notable decliners, as BDY Co. took a 6.8% dive, and Dongfeng Motor Group Co. sank 2%.
Resources weak
Losses for resource shares weighed across Asia as growth concerns cast doubt on future demand for commodities.
“Weak data and an elusive growth turnaround in China have led us to lower our 2013 growth forecasts for much of [emerging Asia],” Barclays strategist Nigel Chalk wrote in a research report.
“Growth is stabilizing but, looking ahead, the recovery is likely to be subdued,” Chalk said.
Hong Kong-listed Aluminum Corp. of China Ltd. slumped 3.5%, China Coal Energy Ltd. dropped 1.4%, and Jiangxi Copper Co. lost 1.8%.
Steelmakers fell in Seoul. Hyundai Steel Co. dropped 1.4% and POSCO eased 0.9%.
Miners added to weekly losses in Sydney, as commodity futures fell in electronic trading.
Diversified miners BHP Billiton Ltd. and rival Rio Tinto Ltd. gave up 1.7% and 2.6% respectively in Sydney, while rare earths group Lynas Corp. tumbled 5%.
Marketwatch
