Japan Stocks Rally In Blah Day For Rest Of Asia
Japanese stocks rebounded sharply Wednesday, helped by strength among the auto shares, with other Asian markets putting in a lackluster performance.
Japan’s Nikkei Stock Average ended 3% higher after a 1.1% drop in the previous session, Australia’s S&P/ASX 200 finished with a 0.6% loss despite a higher open, and South Korea’s Kospi was down 0.3% just ahead of the close.
In China, Hong Kong’s Hang Seng Index sat 0.1% lower in choppy late trading, while the Shanghai Composite Index was off 0.2% ahead of a four-day weekend for mainland Chinese markets.
While the Dow industrials and the S&P 500 Index both closed at record highs overnight in the U.S., CMC Markets senior trader Tim Waterer said that Asian investors were taking a cautious stance ahead of key events, including a European Central Bank meeting on Thursday and U.S. employment data Friday.
“Aside from the performance of the Nikkei [Average], most of the markets across Asia today failed to share the buying enthusiasm shown by Wall Street. Traders for the most part today showed a reluctance to open or extend long positions with so much ‘event risk’ waiting in the wings for the remainder of the week,” he wrote in a note to clients.
Car makers were the big winners in Tokyo, as Toyota Motor Corp. gained 3.8%, Honda Motor Co. climbed 4.6%, Nissan Motor Co. improved by 3.9%, Mazda Motor Corp. shot 6.5% higher, and Fuji Heavy Industries Ltd. added 4.3% despite reports saying it will recall some 200,000 Subarus.
The major Japanese names saw strong U.S. sales numbers for March, with Honda enjoying a 7.1% surge amid popularity for its Acura models.
The gains in the U.S. offset grim results for the Chinese market, where Nissan’s sales fell 17% in March from a year earlier, while those of Toyota dropped 12%, and Honda’s decreased by 7%, according to Dow Jones Newswires.
An advance for the U.S. dollar against the yen overnight, with the greenback returning to the mid-¥93 level, helped many of the blue-chip exporters.
Toshiba Corp. rallied 2.5% after a mild loss Tuesday, NEC Corp. finished with a hefty 6.1% gain, and Fujitsu Ltd. rose 2.7%.
Not everyone benefited, however. Panasonic Corp. tanked 2.2%, while Sharp Corp. plunged 5.6% as reports said the struggling firm was planning a share issue to shore up its finances.
Also helping support the Japanese market, Fast Retailing Co. — among the most heavily weighted names on the Nikkei Average — zoomed 13.9% upward after posting record high same-store sales for March at its Uniqlo casual-clothing chain.
Financials saw a volatile session but ended mostly higher ahead of Thursday’s Bank of Japan policy decision, the first with Haruhiko Kuroda as governor, with the markets hoping for fresh monetary easing. See video on how Bank of Japan may not ease as much as some expect
Mizuho Financial Group Inc. rose 1%, Shinsei Bank Ltd. climbed 3.2%, and Credit Saison Co. rallied 3.8% after Barclays upgraded the shares to overweight.
Hong Kong stocks gyrated between gains and losses, with techs among the gainers. Lenovo Group Ltd. added 1.2%,and Foxconn International Holdings Ltd. rose 0.7% .
Helping sentiment, a pair of surveys gauging China’s services sector showed solid gains, with HSBC’s services Purchasing Managers’ Index hitting a six-month high of 54.3 in March, while the official version of the services PMI rose to 55.6 in March from 54.5 the previous month.
“So there is still growth in the service sector of China, which is positive and in line with the wider development of the China markets,” wrote Andrew Sullivan, head of sales trading at Kim Eng Securities.
But weakness in resources dragged on the Hong Kong market, with Aluminum Corp. of China Ltd. losing 2%, and Jiangxi Copper Co. dropping 1.9%. Gold producer Zijin Mining Group Co. fell 2% after New York-traded gold settled at a four-week low overnight and extended those losses during the Asian day.
The resource space — and miners in particular — was also a focus of selling in Australia, where Rio Tinto Ltd. lost 2%, Fortescue Metals Group Ltd. tumbled 3.4%, Alumina dropped 2.8%, and Newcrest Mining Ltd. gave up 3%
Elsewhere in Sydney, Australia & New Zealand Banking Group lost 1.9% after news the head of its international unit would depart, while shares of News Corp. rallied 1.7% after an anonymously sourced Wall Street Journal report that the company is exploring the sale of its Dow Jones Local Media group.
News Corp. owns The Wall Street Journal and MarketWatch, the publisher of this report.
In Seoul, STX Offshore & Shipbuilding Co. went limit-down, tumbling 15% as Dow Jones Newswires reported the firm asked its creditors for financial support due to liquidity concerns.
Weakness on the South Korean bourse came as tensions grew further with the communist North, which made the rare move of barring hundreds of South Koreans from entering a joint industrial complex.
The action came as The Wall Street Journal reported South Korea is seeking approval from the U.S. to produce its own nuclear fuel after North Korea said it plans to restart all facilities at its main nuclear complex.
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