Asia Markets

Asia stocks mixed; Toshiba plunges 20% after it flags possible one-off loss of several billion dollars

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Asian shares were mixed on Wednesday, with shares in South Korea down as its political scandal grows more entangled and Toshiba plunges 20 percent on a possible write-down of several billion dollars related to its Westinghouse unit.

Japan's wavered between trading positive and negative, and closed flat at 19,401.72 after data showed that Japanese industrial production rose by 1.5 percent in November from a year earlier, lower than a Reuters forecast for 1.6 percent. Japan's November retail sales painted a rosier picture of Japan's economy, up 1.7 percent year-on-year, compared with a Reuters forecast for growth of 0.7 percent.

Toshiba shares plunged 20.43 percent to 311.6 yen each, hitting the Tokyo exchange's daily downward limit, after falling 11.6 percent on Tuesday. The company said on Tuesday it may have to book several billion dollars in one-off charges related to a U.S. nuclear power plant construction company acquisition.

"With Toshiba's finances already weak, the booking of impairment losses is a negative," Masaya Yamasaki, an analyst at Nomura, said in a note dated Tuesday. "With the amount of losses not yet clear, all the bad news is not out."

Asian markets open mixed

Industrial power tool maker Hitachi Koki was up 16.2 percent to 1,456 yen per share, after the stock was initially suspended following a Nikkei report that U.S. private equity firm KKR & Co was in the final stages of negotiations with parent company Hitachi to buy Hitachi Koki.

Mainland Chinese markets were negative, with the finished down 0.39 percent or 12.12 points at 3,102.54 and the Shenzhen composite ended down 0.373 percent or 7.39 points at 1,972.35. Hong Kong's recovered from earlier losses to trade up 0.56 percent by mid-afternoon.

In South Korea, the Kospi closed down 0.87 percent or 17.68 points at 2,024.49, as the east Asian country remains mired in a complicated political crisis, involving President Park Geun-hye who has been impeached.

On Wednesday morning, the special prosecution investigation team arrested the National Pension Service chairman, Moon Hyung-pyo, but did not provide further details. In November, two presidential aides were arrested for being involved in a corruption scandal.

Australia's ASX 200 rose 1.01 percent or 57.27 points to close at 5,685, buoyed by strong gains in its materials sub-index, up 2.32 percent, and in its all ordinaries gold sub-index, up 4.01 percent.

The major miners in Australia were all higher; Rio Tinto jumped 2.38 percent at A$60.17 a share, Fortescue Metals surged 3.47 percent at A$5.97 and BHP Billiton was up 3.29 percent at A$25.44. Gold miners also rallied, with Newcrest up 2.99 percent at A$18.62 and Evolution Mining gained 4.86 percent to A$1.84 per stock.

Major U.S. indexes closed slightly higher, with the composite at a record close, up 0.45 percent at 5,487.44. The finished up 0.06 percent at 19,945.04, while the S&P 500 was up 0.22 percent at 2,268.88, led by information technology and materials.

"Further improvements in U.S. economic conditions fed buying in copper and iron ore, as well as oil prices [on Tuesday], which saw the materials sector lead the S&P 500 index higher," said Michael McCarthy, chief market strategist at CMC Markets, in a note on Wednesday. He explained that the importance of materials to the ASX 200 might lead to a day of outperformance for the index.

On the currency front, the dollar index, which tracks the greenback against a basket of currencies, slipped below 103, to trade at 102.91.

Against the dollar, the yen tracked at 117.49 while the Australian dollar strengthened to $0.7208, after trading as low as $0.7152 on Christmas Day.

Oil prices slipped during the Asian session as the market awaits the planned output cut deal between the Organization of Petroleum Exporting Countries (OPEC) and non-OPEC producers, which takes effect on January 1. Brent futures were down 0.14 percent at $56.01 a barrel, as U.S. crude futures lost 0.11 percent at $53.84.

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