Asian markets trade mixed, key health care vote eyed

Asia markets traded mostly higher on Thursday after U.S. equities closed mixed as traders await a key health care vote in Congress, which is seen as a proxy of U.S. President Donald Trump’s mandate.

Japan’s Nikkei 225 wavered, initially opening up positive before falling the 19,000 mark. It last traded flat. Yesterday, the benchmark index closed sharply lower yesterday by 2 percent to 19,041.38.

Down Under, the ASX 200 was up 0.31 percent. The Kospi index gained 0.16 percent.

The Shanghai composite traded up 0.31 percent and the Shenzhen composite inched up 0.32 percent.

Ping An Insurance Group, China’s second-largest insurer by market value, said on Wednesday after market close that its annual net profit rose by 15 percent to 62.4 billion yuan ($9.06 billion) in line with analysts’ expectations.

The Hong-Kong listed insurer saw its shares rise 2.43 percent on Thursday morning.

Hong Kong’s Hang Seng index gained 0.3 percent in early trade.

Shares of Tencent were down 0.98 percent, after its fourth-quarter profit lagged estimates.

The Chinese investment holding company said after the market closed on Wednesday that net profit for the three months to December rose 47 percent to 10.53 billion yuan ($1.53 billion) but a Reuters poll of analysts had expected 11.75 billion yuan.

Li Ka Shing, Hong Kong’s richest man, had two of his flagship companies report earnings on Wednesday after the market closed. CK Hutchison’s full year net profit was up 6 percent on-year, at HK$33.01 billion ($4.25 billion) while Cheung Kong Property posted a 16 percent rise to its full-year core profit. Shares of CK Hutchison rose 0.57 percent while Cheung Kong Property was up 1.51 percent.

Over on Wall Street, the Dow Jones industrial average fell 0.03 percent to 20,661.3, the S&P 500 closed up 0.19 percent at 2,348.45 and the Nasdaq composite rose 0.48 percent to end at 5,821.64.

Later on Thursday in the U.S., the House is expected to vote on House Speaker Paul Ryan’s healthcare plan, but the Obamacare replacement has seen resistance not just from Democrats, but from conservative GOP members too.

“This vote then, during Asian trade tomorrow, will be seen as a proxy for the strength of the mandate that Trump’s has to govern,” explained Chris Weston, chief market strategist at IG, in a Thursday note.

The market’s concern is that a prolonged battle in Congress to repeal and replace Obamacare could delay tax reform, deregulation and government spending.

Reports said that the White House Office of Management & Budget (OMB) Director Mick Mulvaney and House Freedom Caucus Chairman Mark Meadows were in discussions on Wednesday U.S. evening time.

The discussion is about how to eliminate Obamacare essential health benefits insurance policy language in the House healthcare reform bill, as many Republicans believe that without the inclusion of this language, the current House bill will exacerbate the problems related to Obamacare.

“So much is on the line. If this deal fails, the entire 2017 Washington policy timeline comes into question. There’s at least a 150 handles of legislative love priced into stocks at today’s nosebleed levels. Traders are hoping this Hail Mary lands on target.” Lawrence McDonald, managing director and head of global strategy at ACG Analytics, told CNBC.

Catching attention is a Wednesday afternoon terror incident in London which left five dead, including an attacker and a police officer. A suspected terrorist plowed a car into pedestrians on London’s Westminster Bridge and then fatally stabbed a police officer before being shot.

The pound fell to a low of $1.2426 after loud bangs were heard outside the British parliament. By Asian morning, sterling traded stronger at $1.2482 against the greenback.

The dollar was trading at 99.796 against a basket of currencies at 11:42 am HK/SIN. Against the greenback, the yen traded at 111.37, strengthening for the eighth consecutive session.

Federal Reserve Chair Janet Yellen will give the keynote speech at the Federal Reserve System Community Development Research conference on Strong Foundations; the Economic Futures of Kids and Communities.

During Asian trade on Thursday, Brent crude gained 0.65 percent to $50.97 a barrel, after testing the $50 mark overnight, and U.S. crude was up 0.75 percent to $48.40.

Oil prices slipped on Wednesday after Energy Information Administration (EIA) data showed that U.S. stockpiles climbed almost 5 million barrels to a record 533.1 million last week, beating forecasts of a 2.8 million-barrel increase.

Source: CNBC