Asian stock markets were trading lower in cautious trade on Tuesday
Asian stock markets were trading lower in cautious trade on Tuesday, following weaker than expected earnings from U.S. aluminum giant Alcoa which reported after the bell.
Japan’s Nikkei Average [JP;N225 10833.96 35.6396 (+0.33%) ] turned lower after it hit a 15-month high earlier, lifted by resource-linked stocks such as Sumitomo Metal Mining on higher gold prices, though tech stocks fell pressured by a stronger yen.
The broader Topix gained 0.5 percent to 946.05.
Seoul shares also reversed earlier gains to trade lower. The market was weighed by falls in banking and shipbuilding issues including KB Financial and Hyundai Heavy Industries.
Australian stocks fell 0.6 percent, led down by the top miners, while shares in Alumina slumped after partner Alcoa reported results that missed analyst expectations.
Metals giant Alcoa, the first Dow company to publish results, reported a narrower fourth-quarter loss after U.S. markets closed, but missed expectations, sending its shares down 6
percent in after-hours trade.
That sent shares in Alumina, a partner with Alcoa Inc in the Alcoa World Alumina and Chemicals joint venture, down 3.6 percent to A$1.985.
The benchmark S&P/ASX 200 index [AU;XJO 4904.6 -46.061 (-0.93%) ] fell 28.1 points to 4,922.6 after closing at a 15-month high on Monday following four straight weeks of gains.
Top miner BHP Billiton fell 1.8 percent to A$43.65 and rival Rio Tinto fell 1.3 percent to A$78.94 after base metals prices softened.
Rio said late on Monday a Chinese investigation into a detained Australian Rio Tinto Ltd executive and three colleagues has been sent to prosecutors
Shares in CSR jumped 5.3 percent to A$2.07 after the company said it had received an expression of interest in its sugar and renewable energy business from China’s Bright Food Group But it added that the approach lacked certainty and was not a formal proposal.
Shares in vaccine maker CSL slipped A$0.01 to A$31.92. On Monday the company said the United States had cut its order for CSL’s H1N1 flu vaccine in half.
Brewer Foster’s Group climbed 0.2 percent to A$5.46, as consolidation in the global beer industry reminded investors that the brewer is a potential takeover target.
Seoul shares turned lower weighed by financials but losses were capped by a modest rebound in key tech and auto issues and amid the stabilisation of the won.
The Korea Composite Stock Price Index (KOSPI) was down 0.33 percentat 1,688.48 points.
Key tech and auto issues turned around following their recent losing streak. Samsung Electronics advanced 0.5 percent, while Hyundai Motor rose 0.49 percent, further helped by relatively positive comments from an executive on the automaker’s U.S. market share.
The won barely changed against the dollar early on Tuesday as caution grew over potential dollar-buying intervention by the foreign exchange authorities.
Among financials, Shinhan Financial shed 1.64 percent, and Samsung Securities lost 1.95 percent.
Hanwha Securities tumbled 6.34 percent after news the medium-sized domestic brokerage had submitted a bid for Prudential Investment & Securities and its fund management affiliate.
“Hanwha will probably have to issue more shares in order to raise adequate capital for the deal. Capital increases themselves are negative to investor sentiment,” said Heo Dae-hoon, an analyst at NH Investment & Securities.
Domestic consumption-focused issues also advanced. Shares in Shinsegae, South Korea’s top retailer by market value, gained 0.61 percent. Lotte Shopping, the country’s No.2, went up 0.63 percent.
Shares in LG Chem gained 2.1 percent after a report the firm would sell rechargeable batteries for hybrid cars to Ford Motor from 2012. A senior spokesman at LG Chem said nothing had been decided yet.
Hong Kong shares dipped, giving up Monday’s 0.5 percent gain.
The benchmark Hang Seng Index was down 113.4 points at 22,298.1 by mid-day.
Shares in Lenovo Group rose as much as 4.15 percent on expectations sales of the computer maker’s new products will be strong in China.
Exporters rose on growing hopes that robust China trade data would boost demand for garments and other products shipped overseas. Yue Yuen Industrial was up 0.6
percent at HK$25.25, Esprit Holdings gained 2.01 percent to HK$58.40 and Li & Fung was 0.58 percent higher at HK$34.85.
Growth in China’s exports and imports last month exceeded expectations, providing fresh evidence of the vigour of the economy.
But shares in Aluminum Corp of China (Chalco) fell as much as 4.7 percent, as investors reacted to worse-than-expected results from U.S. aluminum producer Alcoa.
Banking stocks slid in active trade amid persistent worries that Beijing will rein in lending. Industrial and Commercial Bank of China fell 2.2 percent to a three-week low of
HK$6.15. China Construction Bank lost 1.07 percent to its lowest level in more than a week at HK$6.49 and Bank of China fell 1.65 percent to a one-week low of HK$4.17.
Chinese banks extended about 600 billion yuan ($88 billion) in new loans in the first week of 2010, the Economic Information Daily reported on Monday. The surge in lending, nearly double the monthly average in the last half of 2009, could prompt the central bank to step up credit controls, it added.
China’s key Shanghai Composite was flat at mid-day, up 0.1 percent at 3,217.0 points.
Zongshen Power Machinery hit a two-year high of 21.98 yuan before steadying, despite a denial by the company over media reports that U.S. investor Warren Buffett had shown interest in the Chinese motorcycle maker. It was last quoted up 5.4 percent at 21.18 yuan.
Zongshen had no contact with Buffett and had not held any discussions related to his possible investment in the company, the company said in a statement to the Shenzhen stock exchange late on Monday.
A rumour that Zongshen Chairman Zuo Zongshen will visit the United States to meet Buffett on Jan. 25 saw the company’s shares climb by their 10 percent trading limit on Monday.
In Southeast Asia, stocks in Singapore and Malaysia edged lower.
The Straits Times Index slipped 0.1 percent. Olam International outperformed the broader market, gaining 1.85 percent after saying it has agreed to buy 99.5 percent of Nigerian wheat miller Crown Flour Mills for $107.6 million.
Thomson Medical advanced 1.4 percent, as investors reacted positively to its 25 percent jump in net profit to S$3.55 million for the fiscal first quarter, helped by a rise in admissions and an increase in the number of babies delivered.