Tokyo down again as Asian markets end volatile year

31-Dec-2016 Intellasia | Reuters | 6:00 AM Print This Post

Tokyo retreated again Friday despite Toshiba’s shares ending their three-day free fall as Asian markets prepared to bring the curtain down on a volatile 2016.

With Wall Street inching back further from breaching the historic 20,000 barrier, Japanese stocks fell for a second day, losing 0.6 percent to wipe out all gains for 2016 with the Nikkei on course to finish the year broadly flat.

But shares in troubled Toshiba rose following a bloodletting since Tuesday that saw investors dump stock over a massive one-time loss.

Hong Kong advanced 0.6 percent, with the Hang Seng also ending the year broadly unchanged.

Shanghai recorded a modest gain of less than 0.1 percent but stocks in the world’s second largest economy have endured a torrid year, buffeted by feckless policymakers, massive capital flight and a languishing currency. Shanghai’s benchmark was set to end the year about 12 percent down.

The falling yuan – lowered seven percent by the central bank over the year in the face of a surging dollar – has driven investors abroad in search of better performance.

Trading has been light worldwide this week, with volumes in crude oil, equities and currencies all below average.

Analysts said investors may be reallocating money as they take stock of recent asset moves.

“Markets are extremely thin and perhaps position tuning occurred,” Shigeki Yoshitoshi, head of Japan foreign-exchange and commodities sales at Australia & New Zealand Bank Group in Tokyo, told Bloomberg News.

Traders are winding down Friday ahead of New Year celebrations, with Sydney, which is set to end the year more than seven percent up, closing early along with Wellington and Manila.

Australian stocks ended 0.6 percent down.

South Korea was closed for a holiday with the Kospi recording a 3.3 percent advance for 2016 despite political turbulence.

While the London Stock Exchange is ending the year at record levels, Britain has been rocked by the shock vote to leave the European Union in June, with sterling the year’s second-worst performer among major currencies, beaten only by the Mexican peso.

On the other side of the Atlantic, the dollar has climbed about 10 percent against the yen since the surprise outcome of the US election propelled Donald Trump to the presidency. The Japanese currency, which rose against the greenback Thursday, was up marginally against the dollar Friday at 116.41 yen.

The Dow has also reached new highs as dealers bet Trump’s plans for big state infrastructure spending, tax cuts and deregulation will fire the US economy.

Oil also bounced back this year, with West Texas Intermediate recovering from below $30 per barrel to rise above $50. Its performance has been boosted by an OPEC production cut deal slated for January.

However, oil prices fell Friday with WTI down to $53.92 per barrel after official US inventory data showed a surprise rise of 600,000 barrels in crude reserves, while the market had been expecting a 1.5 million-barrel drop in commercial crude stockpiles.

– Key figures around 0730 GMT -

Tokyo – Nikkei 225: DOWN 0.6 percent at 19,032.82

Hong Kong – Hang Seng: UP 0.6 percent at 21,924.78

Shanghai – Composite: UP 0.1 percent at 3,097.96

euro/dollar: UP at $1.0539 from $1.0484

Dollar/yen: DOWN at 116.41 yen from 116.63 yen

Pound/dollar: UP at $1.2285 from $1.2265

Oil – West Texas Intermediate: DOWN 14 cents at $53.92 per barrel

Oil – Brent North Sea: DOWN 8 cents at $56.14 (Thursday close)

New York – Dow: DOWN 0.1 percent at 19,819.78 (close)

London – FTSE 100: UP 0.2 percent at 7,120.26 (close)


Category: FinanceAsia

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