Asia Markets

Asia markets close mixed after subdued session; Subaru falls 7%

Key Points
  • Asian shares closed mixed after a subdued session
  • Subaru shares fell after the automaker acknowledged quality control issues
  • Senate Republicans passed the GOP tax bill while House Republicans will have to take a second vote after running into a procedural issue
  • Bitcoin fell while the dollar was on the back foot against a basket of currencies
  • Oil prices edged higher

Asian stocks were subdued in Wednesday trade, tracking the mixed performance on Wall Street overnight.

The Nikkei 225 edged up 0.1 percent, or 23.72 points, to close at 22,891.72 as banks and trading houses rose. Tech shares were mixed, with Nintendo sliding 1.26 percent by the end of the day. Japan Display bounced 3.08 percent following local media reports that it was in investment talks to potentially receive above 200 billion yen ($1.8 billion) from three Chinese companies, Reuters said.

Automaker Subaru plunged 7.06 percent after the company acknowledged a report that inspectors who had yet to be certified conducted vehicle inspections. Subaru said it would be implementing measures to restore public trust in the company. The rest of the Japanese auto sector was a mixed picture.

Meanwhile, South Korea's benchmark Kospi index ended 0.25 percent lower at 2,472.37 as gains in manufacturing names were offset losses in blue-chip names in other sectors. Samsung Electronics declined 1.32 percent, Hyundai Motor lost 0.33 percent and Posco rose 1.99 percent by the end of the day.

South Korean retailers were lower in morning trade after South Korean newspaper JoongAng Ilbo reported that visas to South Korea for Chinese tour groups had been banned once more. Lotte Shopping closed down 1.78 percent and cosmetics giant Amorepacific fell 2.86 percent .

Over in Australia, the S&P/ASX 200 inched higher by 0.06 percent to close at 6,075.60, with gains seen in the resources space. Most mining companies continued their climb, with Rio Tinto closing up 0.88 percent and Atlas Iron jumping 10 percent. The telecommunications and utilities sub-indexes were lower by 0.9 percent and 0.7 percent, respectively.

Markets in greater China traded slightly lower. The traded lower by 0.14 percent at 3:05 p.m. HK/SIN after gaining more than 200 points in the last session. Casino stocks rose, with Melco International Development adding 2.15 percent by 3:08 p.m. HK/SIN, but heavyweight AIA was lower by 0.63 percent and Tencent slipped 0.7 percent.

Mainland indexes recorded moderate losses in a thinly-traded session, which saw telcos among the worst-performing sectors on the day. The lost 0.27 percent to close at 3,287.61 and the Shenzhen Composite edged down by 0.74 percent to end at 1,891.52.

US Senate passes tax bill

Senate Republicans passed a tax bill aimed at reforming the U.S. tax system on Wednesday. Among the sweeping changes is a provision that will see the corporate tax rate cut from 35 percent to 21 percent in 2018.

Before the bill is signed by President Donald Trump, House Republicans will have to vote on it for the second time on Wednesday despite approving the plan by a margin of 227-203 earlier on Tuesday. The do-over is required as three provisions in the bill previously did not meet a procedural rule.

The dollar index, which tracks the U.S. currency against six major peers, was little changed, trading at 93.468 at 2:43 p.m. HK/SIN. Compared with stocks, the greenback has had a subdued reaction to tax reform optimism, although the dollar index had begun the week around the 94 handle.

Against the yen, the dollar was firmer at 112.99, compared to its previous close of 112.89.

Wall Street declined on Tuesday after hitting record closes in previous consecutive sessions. Among notable moves in the session was a 1.1 percent fall in Apple shares after the tech giant was downgraded by Nomura Instinet.

The Dow Jones industrial average edged down 0.15 percent, or 37.45 points, to close at 24,754.75. Other major indexes recorded slightly steeper losses, with the tech-heavy Nasdaq composite shedding 0.44 percent to end at 6,963.85.

In energy markets, oil prices extended gains as markets focused on the Forties Pipeline shutdown in the North Sea. Investors also awaited official information on U.S. stockpiles after the American Petroleum Institute said Tuesday that inventories had declined more than forecast.

U.S. crude gained 0.31 percent to trade at $57.74 per barrel. Brent crude futures rose 0.24 percent to trade at $63.95.

Bitcoin tumbles

Meanwhile, bitcoin took a dive late during the U.S. Tuesday trading day, losing $1,000 in the span of an hour. CME and Cboe bitcoin futures also settled lower in the last session. The move lower also came as bitcoin platform Coinbase began letting users trade bitcoin cash.

At 2:47 p.m. HK/SIN, the cryptocurrency traded at $16,106.88, according to industry site CoinDesk. It had fallen as low as $15,577.74 earlier.

Corporate news

Japanese refiner Idemitsu Kosan soared 2.96 percent following news that it will merge crucial operations with Showa Shell Sekiyu. The companies will set up a joint office early next year in a bid to reduce costs by 30 billion yen ($266 million), Reuters reported. Showa Shell finished the session 0.66 percent higher.

Also of note, property developer Dalian Wanda said it would establish "capital cooperation" with retailer Suning Commerce Group, the company said in a statement. Shares of the latter closed up 3.15 percent.

Shares of Hong Kong-listed Fosun International were down 1.58 percent by 2:48 p.m. HK/SIN. Reuters had reported that the conglomerate was looking to buy a majority stake in Italian lingerie company La Perla.

Mitsubishi Materials on Tuesday said it has found additional issues relating to a data fabrication scandal at the company. In its latest update, Mitsubishi Materials said its Mitsubishi Cable Industries unit could have fabricated data on some of its magnet wires. Shares of the company closed up 0.92 percent.