Asia trades mixed as dollar retreats on Trump remarks; fate of Samsung chief eyed

Kazuhiro Nogi | AFP | Getty Images

Asia markets finished mostly higher on Wednesday, as the dollar index retreated from levels above 102 reached in the previous week, fueled by remarks from President-elect Donald Trump.

Trump spoke to the Wall Street Journal and remarked the greenback was already "too strong," partly because China was keeping the yuan weak, and that stateside companies are unable to compete with their Chinese counterparts as a result.

His remarks had sent the dollar index, a trade-weighted basket of currencies, from levels above 102.80 last week to the 100 handle this week. On Wednesday afternoon Asia time, the dollar traded at 100.63 after hitting an intraday session low of 100.32.

A stronger dollar can boost earnings for exporters paid in greenbacks, but a weaker level also makes imports cheaper for commodities priced in the U.S. currency

"It was a matter of time that Trump's diametrically opposed policy objectives (fiscal expansion and protectionist bias) and outcomes (higher U.S. Treasury yields and consequently stronger dollar) came home to roost," Vishnu Varathan, a senior economist at Mizuho Bank, pointed out in a note.

Meanwhile, the British pound saw its biggest one-day gain against the dollar overnight since October 2008, after Prime Minister Theresa May announced her plan for a clean break between the U.K. and the European Union. The pound rose from levels near $1.20 to about $1.24.

On Wednesday afternoon during Asian hours, Cable retreated to $1.2346, from an earlier high of $1.2415.

Symbol
Name
Price
 
Change
%Change
NIKKEI
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HSI
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ASX 200
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SHANGHAI
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KOSPI
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CNBC 100
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In Japan, the Nikkei Stock Average closed up 80.84 points, or 0.43 percent, to 18,894.37, with export-oriented shares receiving a boost from a weaker yen.

The yen withdrew from the 112 handle reached in the previous session to trade up at 113.27 versus the dollar at 2:49 p.m. HK/SIN.

Major Japanese exporters finished mostly higher, with Toyota climbing 0.25 percent, Nissan up 1.27 percent and Honda adding 1.49 percent. Electronics maker Sharp declined 2.41 percent, while Toshiba shares advanced 2.38 percent.

The Nikkei business daily reported that Toshiba was considering spinning off its semiconductor business and selling a partial stake in the unit to Western Digital.

Across the Korean Strait, the Kospi finished near flat at 2,070.54, as Samsung shares steadied ahead of a court decision on whether to approve the issuance of an arrest warrant for Jay Y. Lee, the scion of Samsung Group. The court's decision could come as late as midnight local time, according to Reuters.

Lee, who was questioned on Wednesday by a judge, has been accused by South Korean investors of paying bribes to Choi Soon-sil, a friend of President Park Geun-hye, and who has been at the center of a corruption and influence-peddling scandal.

Samsung Electronics shares finished down 0.1 percent at 1,847,000, while Samsung C&T fell 1.6 percent. Samsung Engineering gained 1.9 percent.

Australian shares bucked the trend among major markets, with the ASX 200 closing down 20.66 points, or 0.36 percent, at 5,678.75, with the heavily-weighted financial sector falling 0.85 percent.

In China, the Shanghai composite was up 0.12 percent, while the Shenzhen composite slipped 0.45 percent. Hong Kong's Hang Seng advanced 1.15 percent in late-afternoon trade.

In company news, Hong Kong-listed MGM China fell 1.85 percent, after the company announced that the opening of MGM Cotai, Macau will be delayed from the second-quarter of 2017 to the second half of the year.

"We believe the delay is more due to construction challenges and getting the 'right' product for the opening, but needless to say, an on-time opening will require obtaining necessary government approvals in a timely manner," said research analysts at Nomura, in a note on Wednesday.

Other gaming shares mostly rose, with Wynn Macau advancing 1.74 percent in afternoon trade, Sands China up by 1.45 percent and Galaxy Entertainment gaining 0.85 percent.

Markets stateside were all lower, with the Dow Jones industrial average down 0.3 percent to close at 19,826.77, the S&P 500 finished down 0.3 percent at 2,267.89 and the Nasdaq composite ended 0.63 percent lower at 5,538.73.

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