ASIA MARKETS: China, Japan Stocks Fall As Rest Of Asia Wavers
02/19/2013| 01:40am US/Eastern
By Sarah Turner, MarketWatch
SYDNEY (MarketWatch) -- Chinese stocks slipped Tuesday, with casino operators skidding in Hong Kong and property stocks falling on the mainland, while Japanese blue chips also lost ground in a mostly range-bound session for Asian markets.
Hong Kong's Hang Seng Index declined 0.8%, while the Shanghai Composite Index fell 1.1%.
Japan's blue-chip Nikkei Stock Average slipped 0.3% to pare a 2.1% gain made in the previous session.
Elsewhere in Asia, the picture was only modestly brighter, as South Korea's Kospi gained 0.1%, Singapore's Straits Times Index added 0.1%, Taiwan's Taiex rose 0.2%, and Australia's S&P/ASX 200 index edged up 0.4% to build on a near four-and-a-half-year high reached in the previous session.
"Investors [are] struggling to rediscover the bullish tone that has pushed many regional indices to multiyear highs," said Perpetual Investments investment market research chief Matthew Sherwood.
Wall Street remained closed Monday for the Presidents Day holiday, with U.S. stock futures pointing to a mildly higher start to trading Tuesday, though action was also choppy.
Nasdaq 100 futures (NDH3) were up 1.75 points, while Dow Jones Industrial Average futures (DJH3) rose 7 points and S&P 500 futures (SPH3) climbed 0.80 points.
In Hong Kong, casino operators saw some big losses, with Hang Seng Index component Sands China Ltd. (>> SANS CHIN ADR) dropping 4.1%, and non-component Galaxy Entertainment Group Ltd. (0027.HK) shedding 4.9%.
Analysts at Deutsche Bank said that, while Macau gaming stocks have already risen by around 15% since the start of the year on average, gaming revenue figures to date for February suggest that revenue may only rise 2% year-on-year in the month. Such a result, they said, would fall below market expectations for a 10% year-on-year rise.
"This may be partly luck-driven and partly due to less direct VIP play at Melco Crown Entertainment Ltd. (>> Melco Crown Entertainment Ltd (ADR)), which is under Taiwan investigation," the strategists said. "The market may react negatively to soft Chinese New Year VIP data," they added.
Still, the strategists said that if share prices sell off further due to anti-corruption statements made at or around the National People's Congress on March 5, for example, "we think that will be a good buying opportunity for investors with 6-12 month horizons, as VIP [gambling] accounts for only 30% of adjusted operating profit (Ebitda)."
Elsewhere, shares of SCMP Group Ltd. , publisher of the South China Morning Post newspaper, fell 6.5% after the firm said that it was in talks over making an acquisition.
SCMP shares have risen more than 23% year-to-date, however, after reports speculating that the firm could be taken private by shareholder Kerry Media Ltd, controlled by Malaysian billionaire Robert Kuok,
On the Chinese mainland, property companies were losing ground, with Gemdale Corp. down 6.3% and Poly Real Estate Group Co. down 4.5%. Broker Citic Securities Co. fell 2.6%.
Local governments in China have been moving to tighten homebuyers' access to credit.
Additionally, The People's Bank of China on Tuesday offered 28-day repurchase agreements to drain 30 billion yuan ($4.8 billion) from the money markets.
Crédit Agricole senior economist Dariusz Kowalczyk said the PBOC move was a "hawkish signal" for money supply in China.
"Not surprisingly, Shanghai fell," Kowalczyk said.
In Japanese trading, stocks paused after rallying Monday on the back of a weaker yen.
The Japanese currency fell at the start of the week after a weekend meeting of the world's top finance ministers and central bankers concluded without admonishing Tokyo for a recent plunge in the yen against rivals.
However, the dollar failed to extend gains on Tuesday, trading at Yen93.64, below its Yen93.81 level late Monday in North America.
Reportedly helping cap the dollar's upside, Japanese Finance Minister Taro Aso said that the government wasn't considering purchasing foreign bonds or changing the law that governs the Bank of Japan.
The country's Prime Minister Shinzo Abe had said Monday that if the Bank of Japan fails to achieve its inflation target, then he might change the central-bank law.
Currency-sensitive firms lost ground Tuesday along with the dollar, with tech firms among the decliners. Advantest Corp. (>> Advantest Corp) fell 1.3%, while Tokyo Electron Ltd. , (>> TOK ELCTRN) gave up 2.5%, and robotics firm Fanuc Corp. (>> FANUC ADR) dropped 4.1%.
Renesas Electronics Corp. (>> RENS ELEC ADR) rose 2% in the tech sector, however, following a Nikkei news report saying the chip maker would appoint a new president as early as this month.
Earnings were providing a boost for some firms, with tire maker Bridgestone Corp. (>> Bridgestone Corp) up 10.4% after posting a quarterly profit of more than double that of a year earlier and forecasting record earnings for 2013.
Earnings from Australian companies saw Mount Gibson Iron Ltd. drop 3.9% after the iron-ore extractor said that its first-half profit slumped to 37.1 million Australian dollars ($38.2 million) from $129.9 million in the year-ago period. At the same time, drinks firm Coca-Cola Amatil Ltd. rose 2% after updating investors.
APN News & Media (>> APN News and Media Limited) -- partly owned by Ireland's Independent News & Media PLC -- fell 8.3% after the mass departure of the firm's chairman, chief executive officer and three independent directors of the board took effect Tuesday morning, following a spat about whether to raise capital.
The departing directors wanted to announce a capital raising at the same time as the firm's results announcement on Feb. 21, APN said. However, shareholders Independent News & Media and Allan Grey, holding around 51% of the firm's capital, are opposed to raising capital at this time, it said.
South Korean trading saw telecom KT Corp. decline 1.3%. Heavyweight electronics firm Samsung Electronics Co. (>> Samsung Electronics Co., Ltd.) recoved from earlier losses to trade up 0.1%.
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