Asian Markets Are Jittery as US Bailout Doubts Persist
Asian stock markets were jittery Wednesday, as fears that U.S. lawmakers will stall a proposed $700 billion bailout of the battered financial sector haunted investors and a firmer yen hurt Japanese exporters.
Shares in Honda Motor and fell nearly 4 percent, but financial shares gained in Sydney and Hong Kong and U.S. Treasury yields rose after Warren Buffett surprised the market with a $5 billion investment in Goldman Sachs.
Japan's third-biggest bank, Sumitomo Mitsui Financial Group rose sharply after media reports that it's also planning to invest several billion dollars in Goldman, though SMFG said it had no plans to do so for now.
Crude oil futures rose nearly 0.5 percent above $107 a barrel, paring Tuesday's losses of nearly $3, ahead of U.S. government inventory data expected to show declines in crude and gasoline stocks.
Japan's Nikkei 225 Average ended up 0.2 percent after spending most of the session in negative territory. Nomura Holdings and other financials gained on hopes that planned investments in U.S. banks would help the sector.
South Korea's KOSPI finished 1 percent higher as foreign investors turned net buyers of shares ahead of anticipated government measures to tackle short-selling, while LG Electronics rose on talk it would close an underperforming unit. A financial regulator issued a statement minutes before the market closing that it has found many incidents of investors breaking the country's current short-selling rules, which prohibit short-selling not backed by borrowed shares.
Australian shares bounced 1.2 percent, led up by the battered financial sector which found a lift from news that billionaire investor Warren Buffett was buying into Goldman Sachs. Macquarie Group closed 10 percent higher while Babcock & Brown gained a massive 32 percent.
Hong Kong shares were almost 0.5 percent higher as a vote of confidence for Wall Street banks from investment guru Warren Buffett spurred a rally in HSBC and Chinese financials. China Life the nation's top insurer surged 4.7 percent as investors shrugged off a 1.5 percent drop on the Shanghai bourse. Europe's largest bank HSBC gained 1.1 percent while China's biggest lender ICBC rose 2.6 percent.
Singapore's Straits Times Index was flat after a weak start with a mixed performance by banks and blue chips.
China's Shanghai Composite Index was up nearly 1 percent. Oil refiners fell sharply in the wake of this week's rise in global oil prices, which threatens to hurt their refining margins. PetroChina, the most heavily weighted stock in the index dropped in response to news that its parent was increasing its stake in the company. Inner Mongolia Yili Industrial Group continued to slide, after the company was implicated in China's scandal over chemically contaminated milk products.