Japan Retreats, Australia Climbs in Choppy Trade

Asian stocks wavered in choppy trade Friday on caution ahead of the month’s end and a long weekend in the U.S., with several major resource shares pulling back after commodity prices dropped on eased worries about a military confrontation in Syria.

Japan’s Nikkei Stock Average JP:NIK -0.53%  dropped 0.7%, and Hong Kong’s Hang Seng Index HK:HSI -0.20%  was off 0.2%, while China’s Shanghai Composite CN:SHCOMP +0.06%  was marginally higher, and Australia’s S&P/ASX 200 AU:XJO +0.84% climbed 0.3%.

All four benchmarks changed direction at least once during the morning.

Stocks on Wall Street advanced overnight as data showing the U.S. economy expanded more rapidly than previously thought in the second quarter trumped concerns that the upbeat data may lead the Federal Reserve to reduce the pace of its bond purchases soon.

U.S. markets are due to close Monday for the Labor Day holiday.

Oil and metal prices dropped, meanwhile, on expectations the U.S. and its allies weren’t likely to immediately launch a military strike against Syria, where pro-government forces reportedly used chemical weapons against civilians recently.

“News that the U.K. House of Commons has voted against military action in Syria, and reports that the U.S. is finding it difficult to marshal conclusive evidence that the [Syrian] regime was directly responsible for chemical attacks, have seen the risk premium in markets like gold and oil wound back,” said CMC Markets chief market analyst Ric Spooner.

In the resources sector, Inpex Corp. JP:1605 -1.98%   IPXHF +3.40% dropped 2.2% in Tokyo, and Cnooc Ltd. HK:883 -0.90%   CEO -1.37% shed 0.8% in Hong Kong, while in Shanghai, PetroChina Co. CN:601857 -1.14% PTR +0.05%  declined 0.9%, and Zijin Mining Group Co. HK:2899 +0.52%   ZIJMF +13.00%  lost 2.6%.

Shares of Rio Tinto Ltd. AU:RIO +0.09%   RIO -1.95%  dropped 0.7% in Sydney following a report from The Australian newspaper that the miner has delayed targeted production at the Simandou iron-ore project in Guinea by three years, as African development plans made during boom years continue to unwind.

But shares of Evolution Mining Ltd. AU:EVN +3.33%   CAHPF +0.56% gained 3.6% as the gold producer said it still plans to pay a year-end dividend despite swinging to a full-year net loss.

Chinese banking shares suffered broad losses amid worries that bad loans could rise in coming quarters, although two of the nation’s largest lenders — Industrial & Commercial Bank of China Ltd. HK:1398 -0.20%   IDCBY +1.51%  and Bank of China Ltd. HK:3988 -0.61% BACHY +0.77% — posted an increase in half-yearly profits.

Shares of ICBC dropped 1%, and those of BOC declined 1.2% in Hong Kong.

The retreat in Tokyo came even as official data released before the stock market opening in Tokyo showed core consumer prices in the country, a measure that excludes volatile fresh-food prices, climbed 0.7% in July from the year-ago month.

The data provided evidence the Bank of Japan’s unprecedented monetary easing was yielding results in its attempt to pull the nation from an era of falling prices.

Source: Marketwatch