Most major Asian stock markets declined Thursday, with Europe’s debt travails back in the frame following a weak German government bond auction.
Japan’s Nikkei Stock Average JP:NIK -1.38 percent fell 1.5 percent, as investors played catch up following a holiday Wednesday – a day when many other Asian stock markets posted steep losses.
Losses were less pronounced elsewhere, with Hong Kong’s Hang Seng Index HK:HSI +0.49 percent down 0.9 percent, China’s Shanghai Composite index CN:000001 -0.15 percent down 0.7 percent and South Korea’s Kospi KR:0100 +0.93 percent trading flat.
However, Australia’s S&P/ASX 200 index AU:XJO +0.46 percent managed to eke out a 0.3 percent gain.
Asian shares have been under broad selling pressure this week, as investors reacted to heightened concerns about Europe’s debt crisis and the potential impact of the crisis on global economic growth.
On Wednesday, a German 10- year government bond auction disappointed, as it failed to reach a 6 billion euro ($8.2 billion) target, sending European and US stock deep into the red. Read more on European stock losses.
“The failure of the auction highlights that core countries are no longer immune to what is happening in peripheral Europe and that investors may be shying away from anything euro-related,” said strategists at BNP Paribas.
A poor manufacturing survey from China on Wednesday underscored risks to global growth, and with a state-media report later that day downplaying chances for further monetary policy easing to shore up Chinese growth, policy-sensitive property shares traded lower in Hong Kong on Thursday.
Henderson Land Development Co. HK:12 -1.20 percent [ HLDVF -3.14 percent fell 1.7 percent, and Sun Hung Kai Properties Ltd HK:16 -0.65 percent SUHJY -3.77 percent lost 1.1 percent.
And while most banking stocks outperformed the Hang Seng Index, London-headquartered HSBC Holdings PLC HK:5 -0.53 percent HBC +1.23 percent – the top-weighted stock on the benchmark index – lost 1.2 percent.
The BNP Paribas strategists said that concerns about global growth are dominating commodity-linked plays, adding that a light data calendar going into the end of the week and the US Thanksgiving holiday on Thursday meant that pressure on the sector could continue in the short term.
Against this backdrop, Japanese commodity-sector traded lower, with Sumitomo Metal Industries Ltd JP:5405 0.00 percent SMMLF 0.00 percent down 0.8 percent, while oil company JX Holdings Inc. JP:5020 -1.28 percent JXHGF 0.00 percent lost 1.3 percent.
Exporters were also weak in Tokyo, with Sony Corp. JP:6758 +0.38 percent SNE -1.75 percent down 0.8 percent, Nintendo Co. JP:7974 -2.47 percent NTDOF -2.88 percent retreating 2.9 percent and Fujitsu Ltd JP:6702 -2.33 percent [ FJTSY -2.51 percent lower by 3.1 percent.
Retailers lost ground in Australia, with department store retailer David Jones Ltd AU:DJS -4.71 percent down 4 percent after stating that its first-quarter sales dropped by just over 11 percent.
Elsewhere in the sector, Myer Holdings Ltd AU:MYR -2.07 percent fell 1 percent and Harvey Norman Holdings Ltd AU:HVN 0.00 percent HNORY 0.00 percent lost 2.6 percent. -By Sarah Turner