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Asia markets mixed; ASX, Nikkei and HSI advance for the week

Asia markets finished mixed on the final trading day of the week, but the major indexes in Australia, Japan and Hong Kong eked out weekly gains.

The Australian ASX 200 closed down 36.31 points, or 0.69 percent, at 5,236.40, led by over 1 percent declines in the energy and materials sub-indexes. For the week, the ASX 200 was up 1.53 percent.

Evan Lucas, a market strategist at IG, said this morning before market open that ASX internals "show glaring profits, and possible buyer exhaustion," with 84 percent of ASX 200 companies above their 50-day moving average, suggesting there might be some profit-taking at play.

In Japan, the Nikkei 225 advanced 208.87 points, or 1.2 percent, to 17,572.49 on the back of a relatively weaker yen. The index has posted gains in four of the last five sessions, rising 4.3 percent for the week. Across the Korean Strait, the Kospi finished down 6.61 points, or 0.33 percent, at 2,015.49 on Friday, but advanced for the week.

Chinese mainland markets finished up, with the Shanghai composite up 6.78 points, or 0.23 percent, at 2,959.67, while the Shenzhen composite added 19.02 points, or 1.03 percent, at 1,867.55. Earlier in the week, the indexes came under pressure, with the Shanghai benchmark selling off as much as 4 percent at one point, which analysts said was due to a liquidity shortage in the country this month.

In Hong Kong, the Hang Seng index closed down 155.21 points, or 0.72 percent, at 21,467.04.

"Share markets mostly continued to move higher over the last week as growth fears from earlier this year continued to recede and the oil price managed to push higher despite the failure of OPEC and Russia in Doha to agree a production freeze," explained Shane Oliver, head of investment strategy and chief economist at AMP Capital.

Oliver explained the decline in Chinese shares this week was "on concerns that there won't be more policy stimulus."

Symbol
Name
Price
 
Change
%Change
NIKKEI
---
HSI
---
ASX 200
---
SHANGHAI
---
KOSPI
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CNBC 100
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Oil prices, which analysts have said tend to have a correlation with stock movements, advanced in Asian hours, following a drop overnight on renewed concerns of oversupply.

Global benchmark Brent futures were up 0.65 percent at $44.82 a barrel as of 3:43 p.m. HK/SIN, after dropping 2.8 percent during U.S. hours. U.S. crude futures were up 0.69 percent at $43.48, after dropping 2.26 percent overnight.

The decline in oil overnight came as Reuters reported market intelligence firm Genscape suggested a build-up of more than 840,000 barrels in U.S. crude at the Cushing, Oklahoma, delivery point in the four days to April 19.

Earlier this week, oil prices had initially sold off after the world's largest oil producers failed to reach an agreement to freeze production in Doha, Qatar, but the commodity has since recovered despite some volatility.

"The ability of oil and share markets to rally despite the failure of key producers to agree on oil production freeze is a positive sign," according to Oliver.

Energy plays in Asia had a mixed session, with Santos declining 0.22 percent, Oil Search adding 0.72 percent, Inpex up 1.91 percent and Japan Petroleum higher by 0.94 percent. Chinese mainland oil plays ended mostly up, with Sinopec advancing 0.44 percent.

Santos shares advanced 10.8 percent this week, with Friday's decline halting a three-day gain as the company released its first quarter production report. Production was up 11 percent on-year, but sales revenue increased by only 1 percent for the same period.

Pedestrians walk past the Mitsubishi Motors Corp. headquarters in Tokyo, Japan, on Thursday, April 21, 2016. Mitsubishi Motors' disclosure that it manipulated fuel-economy tests has seen its share prices plunge in recent sessions.
Junko Kimura-Matsumoto | Bloomberg | Getty Images
Pedestrians walk past the Mitsubishi Motors Corp. headquarters in Tokyo, Japan, on Thursday, April 21, 2016. Mitsubishi Motors' disclosure that it manipulated fuel-economy tests has seen its share prices plunge in recent sessions.

In the currency market, the dollar traded at the higher end of the 94 handle against a basket of currencies, with the dollar index at 94.873 as of 3:57 p.m. HK/SIN.

The Japanese yen weakened further toward the local market close and afterward, with the pair trading at 110.58 in late afternoon local time. This is compared with the 107 level it briefly touched earlier in the week.

Stephen Innes, a senior foreign exchange trader at OANDA, said next week, it is "conceivable a side-lined Bank of Japan would see the dollar/yen trade at 108."

"However, given the very positive risk-on tone in the market coupled with an inactive Fed likely stoking the risk sentiment fires, it's more likely we see a continuation of range trade between 108 and 110," he said, adding the Japanese central bank could still spring a surprise on market.

Major Japanese exporters finished the session mixed, with shares of Toyota up 1.63 percent, Nissan up 1.72 percent and Honda adding 1.44 percent. Shares of Sony were down 1.73 percent. Usually a relatively weaker yen is a positive for exporters as it increases their overseas profits when converted into local currency.

Shares of Mitsubishi Motors finished down 13.55 percent, following a 20 percent drop on Thursday after the company's executives admitted the company cheated on fuel economy tests.

Reuters, citing several Japanese media, said the carmaker reportedly manipulated fuel economy data on an additional car model apart from the vehicles already disclosed; it may have also misstated data on four other models, according to Sankei newspaper.

Japan's Transport Minister Keiichi Ishii said he wanted Mitsubishi Motors to possibly buy back the affected cars, according to Kyodo news.

The country's Internal Affairs Minister, Sanae Takaichi, was quoted by Jiji news agency saying car buyers will not have to pay back Japanese government subsidies for any Mitsubishi vehicles that may fall outside the fuel economy subsidies bracket.

Elsewhere, the Australian dollar was stronger against the U.S. dollar, trading at $0.7744 in the evening local time, after finishing at $0.7737 overnight, but it's down from Asian hours on Thursday, when it touched the $0.78 level.

Innes said reversal in oil prices overnight sent the Aussie downward during U.S. hours. "The stronger dollar weighed negatively on commodity prices and coupled with lower prices in the oil patch, the Aussie sold off in convincing fashion," he said.

Australian miners finished mixed, with major miners Rio Tinto, Fortescue and BHP Billiton losing between 2.95 and 7.18 percent, while Atlas Iron added 4.55 percent.

Metal commodities were mixed in the late afternoon in Asia after market close, with Shanghai rebar futures down some 3.1 percent. But spot iron ore prices advanced by around 6.8 percent, while base metals on the London Metal Exchange were mostly up. Three-month copper prices advanced 0.1 percent and three-month aluminum added 0.21 percent, while three-month zinc fell 0.37 percent.

Chinese metal plays also finished down, with Baoshan Steel losing 2.56 percent and Aluminium Corp. down 4.09 percent.

Major indexes in the U.S. finished lower, with the Dow Jones industrial average closing down 0.63 percent, the S&P 500 falling 0.52 percent and the Nasdaq composite shedding 0.05 percent.

The indexes reacted negatively to earnings from United, Travelers and Verizon - the latter closed 3.3 percent lower as one of the greatest contributors to declines in the Dow.