Asia Markets

Asia closes mixed after oil cracks $60; China underperforms

Key Points
  • Asian indexes closed mixed, although most indexes were little changed on the day
  • Energy-related companies in Japan and Australia notched gains after oil hit a more than two-year high overnight
  • Hyundai Heavy Industries dove 27 percent after it revealed plans to list a subsidiary
  • Apple suppliers in Hong Kong declined after shares of the tech giant fell 2.5 percent in the U.S. session
  • Dollar was mostly flat while the bitcoin recovered after last week's sudden fall

Asian markets closed mixed in Wednesday trade, as Australian and Japanese energy names rose after oil touched a more than two year high overnight. Meanwhile, South Korea's Kospi index reversed early losses as blue-chip tech names rebounded.

Japan's benchmark Nikkei 225 hovered around breakeven for most of the session after coming under slight pressure in the previous session. The index nudged higher by 0.08 percent to close at 22,911.21 as trading houses saw gains while major exporters traded mixed, with Toyota closing 0.29 percent higher.

Meanwhile, energy-related names recorded solid gains after oil prices touched their highest levels in more than two years on Tuesday. Inpex rose 2.31 percent and Japan Petroleum Exploration advanced 3.31 percent on the day.

Across the Korean Strait, the Kospi erased losses seen earlier in the session to finish higher by 0.38 percent at 2,436.67. Blue-chip tech stocks, which had sold off in the last session, were a bright spot, while manufacturing names and financials recorded declines. Samsung Electronics rose 2.41 percent while Posco closed down 1.47 percent.

South Korea's Hyundai Heavy Industries plunged 28.75 percent after it announced Tuesday that it intended to list Hyundai Oilbank in 2018, Reuters reported. The move will likely raise some $1.2 billion through a share issue, Reuters said. Shares of holding company Hyundai Robotics fell 3.74 percent.

In Australia, the S&P/ASX 200 closed flat as gains by gold producers were offset by moderate losses in most other sectors. The S&P/ASX All Ordinaries Gold sub-index rose 2.26 percent. Energy-related names also advanced, with Santos climbing 1.51 percent by the end of the day.

Greater China markets were in negative territory, with the off by 0.12 percent by 3:13 p.m. HK/SIN.

Losses in mainland markets steepened in afternoon trade. The lost 0.93 percent to end at 3,275.4, with technology, health care and financials among the worst-performing sectors on the day. In particularly, insurers were hit fairly hard: China Life fell 2.66 percent and Ping An Insurance lost 4.84 percent. The Shenzhen Composite shed 0.7 percent to close at 1,878.8.

Meanwhile, profits made by Chinese industrial companies rose 14.9 percent compared to one year ago, Reuters said, reflecting the poorest growth figure since April this year. Industrial profits had risen 25.1 percent in October.

Apple suppliers in Asia were also in the spotlight after Apple fell 2.5 percent during the U.S. session following a report from Taiwan's Economic Daily that the company will slash its iPhone X sales forecast. An Apple spokeswoman told Reuters that it did not comment on "market rumors."

Hong Kong lens manufacturer Sunny Optical lost 5.07 percent, and AAC Technologies tumbled 4.84 percent by 3:15 p.m. HK/SIN. Apple suppliers in Taiwan fared better, having already recorded losses earlier this week on that news. Pegatron closed up 1.43 percent and Hon Hai Precision Industry was higher by 1.1 percent.

U.S. stocks finished the Tuesday session lower following the long Christmas weekend. Retailers stateside notched gains, although losses were seen in the tech space. The Dow Jones industrial average closed off 0.03 percent, or 7.85 points, at 24,746.21.

Tracking commodity markets

Oil prices were in focus during the session after soaring to a more than two-year high overnight. That followed news that a crude pipeline in Libya that carried up to 100,000 barrels per day had been attacked on Tuesday, according to Reuters.

U.S. crude futures pared gains on Wednesday, shedding 0.43 percent to trade at $59.71 per barrel after cracking the $60 mark in the previous session. Brent crude shed 0.52 percent to trade at $66.67 after climbing more than 2 percent overnight.

Still on the commodities front, gold prices held onto overnight gains after rising to a more than three-week high in the previous session amid a softer dollar. The yellow metal last traded at $1,282.58 an ounce.

Meanwhile, copper prices rose to its highest levels in 3-1/2 years after customs data out of China showed the country imported 19 percent more refined copper on year, Reuters said. Copper prices are often regarded as a gauge of global economic growth.

Dollar subdued, but bitcoin recovers

Currency markets were relatively quiet in comparison to moves seen in commodity markets. The dollar index, which tracks the U.S. currencies against six major peers, drifted lower to trade at 93.162 at 2:59 p.m. HK/SIN.

The greenback was mostly flat against the Japanese yen, last fetching 113.18, compared to the 113.19 seen on Tuesday. The release of inflation data out of Japan on Tuesday had shown that core consumer prices in Japan increased for 11 consecutive months.

Bitcoin continued to rebound after tumbling late last week. The cryptocurrency extended gains to trade at $16,373.55.24 at 3:00 p.m. HK/SIN after touching as high as $16,476.18 earlier, according to industry site CoinDesk.

More corporate news 

Japan's Mitsubishi UFJ Financial Group said in a statement released Tuesday that it would be taking a 73.8 percent stake in Indonesia's Bank Danamon.

The deal will take place in three stages and supports MUFG's push to expand its presence in the region. MUFG shares closed lower by 0.06 percent, underperforming other Japanese banks on the day.

Meanwhile, shares of Danamon rose 15 percent by 3:00 p.m. HK/SIN after earlier touching a 17-year peak.