Asia Stocks Mostly Higher, China Lags
Asia markets gained Tuesday, with Japanese stocks recovering from early weakness on the back of a solid rally in banks, while Chinese shares retreated from recent gains.
Japan’s Nikkei Stock Average rose 0.5%, South Korea’s Kospi climbed 0.6% and Australia’s S&P/ASX 200 index jumped 1% as the market reopened after Monday’s holiday.
In Chinese trading, the Shanghai Composite index inched down 0.2% after gaining sharply on Monday, while Hong Kong’s Hang Seng Index also slipped 0.2%.
The advance in Japan came as earnings optimism sparked sharp gains in the banking sector, with Sumitomo Mitsui Financial Group Inc. jumping 3.9%, Mitsubishi UFJ Financial Group Inc. climbing 3.6% and Mizuho Financial Group Inc. rising 2.9%.
The Nikkei reported that the recent rally for the Japanese market will lift profits at the banks, which are shareholders in some of the companies that have seen sharp share price gains. Higher stock prices have also pushed up commissions from sales of investment trusts and other products, the report said.
A strong performance from telecom firm KDDI Corp. rising 3.6% also aided the advance in Tokyo.
The firm reported late Monday that its quarterly net profit almost doubled compared to a year ago, in part due to popularity of smartphones, and raised its fiscal-year smartphone sales target to 8.45 million units from a previous forecast of 8 million units.
Meanwhile, the broad advances in Asia came even as U.S. stocks ended mostly lower Monday, as mixed economic data prompted a bit of selling after recent gains. Although technology stocks gained, they couldn’t offset losses for commodity-linked firms.
The tech sector saw some buying in Asia on Tuesday, with consumer electronics giant Samsung Electronics Co. up 1.5% in South Korean trading Tuesday, and Hon Hai Precision Industry Co. rising 1% in Taiwan.
In Hong Kong, shares of property developers and some mainland Chinese banks softened, with Sino Land Co. [ dropping 1.2% and New World Development Co. shedding 1.4%.
Industrial & Commercial Bank of China Ltd. [ fell 2.4% on news Goldman Sachs had on Monday launched the sale of $1 billion worth of the lender’s Hong Kong listed shares, further paring its holding in the Chinese bank.
Providing support to the market, utilities China Resources Power Holdings Co. gained 1.2% and Hong Kong & China Gas Co. [ rose 1.4% as investors bought into the defensive sectors.
Australian investors were also buying into stocks considered less leveraged to economic growth trends, with blood products group CSL Ltd. up 3.5% and Cochlear Ltd. higher by 1.6% in the health care sector.
Miners lagged, however, with gold miners particularly weak. Perseus Mining Ltd. declined 3.4% and OceanaGold Corp. fell 5%.
Marketwatch
