Asia Stock Markets Pull Back After Gains

Asian stock markets headed lower Wednesday, pulling back after recent gains as earnings and weak Japanese trade figures dented sentiment.

Japan’s Nikkei Stock Average 100000018 traded down 0.3%, South Korea’s Kospi SEU lost 0.7%, and Australia’s S&P/ASX 200 index XJO declined 0.1%.

In the Chinese markets, Hong Kong’s Hang Seng Index HSI fell 0.8%, while the Shanghai Composite index 000001 slipped 0.4%.

The drop came after U.S. shares ended with losses Tuesday, even after rising to touching distance of multi-year highs during the session. Read more on U.S. markets.

Credit Agricole strategist Kintai Cheung attributed the late decline in the U.S. market to profit-taking after the recent strong run said that caution was likely to prevail on Wednesday “given plenty of event risks,”

He cited the Greek prime minister’s meetings with European leaders due this week and minutes from the U.S. Federal Open Market Committee’s last meeting due out later Wednesday as examples of such risks.

Stan Shamu, strategist at IG Markets, said Wednesday’s losses in Asia were also due to investors locking in gains after a recent strong run.

“There’s limited drivers,” to push markets in any particular direction at present, he said.

Taking the spotlight in a quiet data calendar this week, Japan announced ahead of the market open that it swung to a trade deficit in July, as exports plunged.

Exports fell 8.1% from a year earlier, far outpacing expectations for a 3.6% fall, as shipments to top trading partner China decreased almost 12% even as U.S.-bound exports rose 4.7%. Read more on Japanese trade data.

Japanese steel makers dropped in Tokyo, with Nippon Steel Corp. 5401  NISTY down 1.7% and Sumitomo Metal Industries Ltd. 5405 SMMLY lower by 2.3%.

Analysts have recently raised the alarm about increasing Chinese steel production in face of price falls for the metal. Read report on the Chinese steel-output paradox.

Maanshan Iron & Steel Co. 323 MAANY fell 3.8% and Angang Steel Co. 347  ANGGY lost 1.9% in Hong Kong, while Korean steel major Posco PKX fell 1.8%.

Also in Seoul, shares of computer chip maker Samsung Electronics Co. SSNLF dropped 1.1% as its high-profile patent battle with Apple Inc. AAPL  headed to jury deliberation in the U.S.

U.S. computer maker Dell Inc. DELL didn’t help sentiment around Asian computer component suppliers, after announcing a downgrade to its fiscal-year outlook and lower-than-expected second-quarter revenue. Read more on Dell.

Chinese computer maker Lenovo Group Ltd. 992 [LNVGF lost 2.4% in Hong Kong.

In Japan, consumer electronics giant Sony Corp. 6758 SNE traded down 0.9%, while Panasonic Corp. 6752 PC, retreated 2.2%.

Shares of computer games firm Nintendo Co. 7974 NTDOF lost 0.3% and those of Kyocera Corp. 6971 KYOCF fell 1% as Kyodo News reported the two were among companies under investigation by a U.S. trade body over possible wireless patent infringement. Read more on U.S. probe of Nintendo and Kyocera.

Still, overnight gains for the euro — on the back of a recent advance fueled by hopes for European Central Bank bond buying — helped some Japanese names with strong European exposure, with Mazda Motor Corp. 7267 MZDAF climbing 1%.

Oil and metal extractors saw some losses in Hong Kong, with Cnooc Ltd. 883 CEO down 1.9%, extending a dive from the previous session after disappointing earnings, while PetroChina Co. 857 PTR  fell 2.3% ahead of its own earnings due later in the day.

Likewise, Aluminum Corp. of China Ltd. 2600ACH — due to give results on Friday — gave up 1.8% in Hong Kong.

Also on the earnings front, China Telecom Corp. 728 CHA posted a more-than-8% drop in its first-half profit. But with the result beating estimates, China’s top fixed-line operator saw its Hong Kong shares rally 3%. Read more on China Telecom earnings.

Still, Anglo-Australian mineral giant BHP Billiton Ltd. BHP BHP advanced 0.7% ahead of its earnings due later Wednesday.

The Australian energy sector retreated, with Woodside Petroleum Ltd. WPL WOPEF moving down 3.4% after reporting a 1.9% decrease in first-half net profit. Read more on Woodside results.

Clothing firm Pacific Brands Ltd. PBG, fell 1.7% after the owner of the Bonds brand reported a wider fiscal-year net loss and announced its chief executive will resign.

Marketwatch