Asia Markets

Asia-Pacific markets mixed; Cathay Pacific shares in Hong Kong jump after restructuring announcement

Key Points
  • Shares of Cathay Pacific in Hong Kong jumped 2.27% after the company on Wednesday announced that about 5,900 employees will be laid off as part of a restructuring plan. The airline's subsidiary Cathay Dragon will also cease to operate with effect from today.
  • The Trump administration and Democrats made progress in coronavirus stimulus negotiations on Tuesday but major differences remain, according to White House chief of staff Mark Meadows.
  • On the coronavirus vaccine front, Moderna's CEO Stephane Bancel expects interim results from the firm's Covid-19 vaccine trial in November, according to The Wall Street Journal.

SINGAPORE — Stocks in Asia-Pacific were mixed on Wednesday as investors continued to watch for developments on U.S. coronavirus stimulus talks.

Mainland Chinese stocks were lower on the day, with the Shanghai composite down fractionally to about 3,325.02 while the Shenzhen component slipped 0.999% to around 13,467.91. Hong Kong's Hang Seng index, on the other hand, advanced 0.75% to close at 24,754.42.

In Japan, the Nikkei 225 added 0.31% to close at 23,639.46 while the Topix index gained 0.73% to finish its trading day at 1,637.60. South Korea's Kospi rose 0.53% to close at 2,370.86.

Meanwhile, shares in Australia edged higher on the day, with the S&P/ASX 200 up 0.12% to 6,191.80.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.35%.

Cathay Pacific shares soar

Shares of Cathay Pacific in Hong Kong jumped 2.27% after the company on Wednesday announced that about 5,900 employees will be laid off as part of a restructuring plan. The airline's subsidiary Cathay Dragon will also cease to operate with effect from today.

"I think the cost cutting is massive," Kelvin Lau, head of auto, transportation and industrial at Daiwa Capital Markets, told CNBC's "Street Signs Asia" on Wednesday.

Lau said the airline is set to have a "leaner cost structure going forward," though he acknowledged the restructuring costs and other impairments faced by Cathay Pacific in the short-term.

Shares of other airlines in the region also saw gains on Wednesday: Australia's Qantas Airways rose 0.23%, Japan Airlines surged 2.93% while ANA Holdings added 1.83% and Korean Air Lines gained 2.69%. In Singapore, shares of Singapore Airlines were up 0.57%, as of about 4:35 p.m. local time.

U.S. coronavirus stimulus talks watched

Investor focus on Wednesday was likely on stimulus negotiations stateside. The Trump administration and Democrats made progress in negotiations on Tuesday but major differences remain, according to White House chief of staff Mark Meadows.

"Even if a deal is not agreed to before November, there are high hopes there will be a package after the election," Tapas Strickland, director of economics at National Australia Bank, wrote in a note.

On the coronavirus vaccine front, Moderna's CEO Stephane Bancel expects interim results from the firm's Covid-19 vaccine trial in November, according to The Wall Street Journal. Bancel also told the Journal that the U.S. Food and Drug Administration could issue an emergency use authorization before the end of the year.

Oil prices slip

Oil prices were lower in the afternoon of Asia trading hours, with international benchmark Brent crude futures down 1.44% to $42.54 per barrel. U.S. crude futures dropped 1.39% to $41.12 per barrel.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was last at 92.713 following its decline earlier this week from levels above 93.6.

The Japanese yen traded at 104.94 per dollar after seeing an earlier low of 105.52 against the greenback. The Australian dollar was at $0.7081, having declined from levels above $0.707 earlier this week.

— CNBC's Terri Cullen contributed to this report.