Tokyo and Hong Kong shares stood out in a broadly positive day for Asian stock markets Wednesday, helped respectively by a weaker yen and hopes for Chinese policy-easing.
Japan’s Nikkei Stock Average JP:100000018 +1.81 percent rallied 1.8 percent, and Hong Kong’s Hang Seng Index HK:HSI +1.02 percent rose 1.1 percent, although the Shanghai Composite index CN:000001 -0.20 percent traded flat.
Australia’s S&P/ASX 200 index AU:XJO +0.29 percent picked up from a flat start to trade up 0.2 percent, boosted by the release of stronger-than-expected gross domestic product data. Read more on Australian GDP.
South Korea was closed for a holiday, while key indexes in Taiwan, Singapore and New Zealand all traded solidly higher.
Japanese stock gains came as the dollar USDJPY +0.26 percent bought JPY 78.80, up from JPY 78.74 in late North American trading Tuesday and Monday’s late trading level of JPY 78.33. The euro euro JPY +0.57 percent, meanwhile, recovered from sub-JPY 98 levels Tuesday to trade at JPY 98.51.
The yen dropped sharply on Tuesday after Group of Seven finance ministers and central bank governors held a conference call in which they agreed to closely monitor developments in Europe. Read more on G-7 call.
Japan’s Finance minister Jun Azumi said after the call that the discussion centered on Europe, but that the G-7 also had no objection to Tokyo taking action to curb excessive volatility and disorderly moves for the yen. Read more on yen move.
“Japan warned the FX markets, threatened them, checked prices and has now a mandate of coordinated action,” said Sebastien Galy at Societe generale.
However, Japan is likely to tread cautiously ahead of Greece’s election on June 17. Similarly, the European Central Bank’s interest-rate meeting due later Wednesday isn’t widely expected to result in a move from the current level of 1 percent for euro zone rates ahead of the Greek vote. Read ECB preview.
Still, even a small amount in weakness for the yen often brings relief for the Japanese equity market, and major exporters were supporting the Nikkei Average on Wednesday.
Sharp Corp. JP:6753 +6.89 percent SHCAF -2.04 percent shot 7.1 percent higher, Nikon Corp. JP:7731 +3.46 percent NINOF -11.47 percent gained 4 percent, and Mazda Motor Corp. JP:7261 +4.26 percent MZDAF -9.16 percent climbed 5.3 percent.
Shares of Nintendo Co. JP:7974 -1.83 percent NTDOF +1.98 percent fell 2.6 percent, however, after failing to offer pricing or a launch date for its new Wii-U videogame console at its publicity event at the E3 industry show. Read more on Nintendo presentation.
Banks were also advancing in Tokyo, with Shinsei Bank Ltd JP:8303 +1.23 percent SKLKF +0.51 percent up 1.2 percent, and Nomura Holdings Inc. JP:8604 +4.76 percent NMR +3.86 percent higher by 5.2 percent.
Hong Kong-listed banks were similarly stronger, with HSBC Holdings PLC HK:5 +1.82 percent UK:HSBA +0.05 percent HBC +0.90 percent up 2 percent and Bank of Communications Co. HK:3328 +1.60 percent BKFCF -14.38 percent rising 1.6 percent.
Insurance firms performing well included Ping An Insurance Group Co. HK:2318 +3.15 percent PIAIF -2.48 percent, up 4.2 percent, and China Life Insurance Co. HK:2628 +1.99 percent. CILJF -0.29 percent up 2.7 percent.
Property firms were also on the move, with China Resources Land Ltd HK:1109 +2.68 percent CRBJF -3.89 percent ahead by 2.4 percent and Henderson Land Development Co. HK:12 +3.49 percent HLDVF +1.23 percent up 4.3 percent.
The gain followed a front-page editorial in the state-run China Securities Journal saying Beijing should cut interest rates. See report on Chinese state media’s rate-cut call.
In Australia, energy firms improved notably for the second straight session, with Santos Ltd AU:STO +0.86 percent STOSF +0.36 percent up 1 percent, and Whitehaven Coal Ltd AU:WHC +2.58 percent WHITF -7.16 percent rallying 2.3 percent. Read more on Australian share market.
Nymex crude-oil futures climbed in electronic trading Wednesday, rising 63 cents to $84.94 a barrel, extending an advance made in regular trading Tuesday after unexpectedly upbeat data on the US services sector.
That data also led to gains for US stock markets on Tuesday, prior to which, the Dow industrials had fallen in the last four trading sessions. Read more on US share moves.
Despite Wednesday’s gains, most Asian stocks were still showing week-to-date losses, knocked by concern that Europe’s debt troubles were spilling over to the global economy. Japan’s outsized move on Wednesday, however, lifted the Nikkei into positive territory for the week.
“The market overall is still cautious and waiting for more information [on Europe],” said Linus Yip, strategist at First Shanghai Securities, adding that Wednesday’s move higher “seems to me to be a technical rebound.” -By Sarah Turner