China small-caps lead gains; rest of Asia mixed
Chinese stocks recovered from the prior day’s sudden sell-off, as a surge in small-caps rekindled investor interest.
The rest of the region, however, put up a mixed performance as renewed weakness in commodity prices and an uninspiring lead from Wall Street kept a lid on risk appetite.
Major U.S. averages finished lower overnight, pulled down by insurers and healthcare plays as well as a mixed bag of corporate earnings. The tech-heavy Nasdaq Composite dropped 0.8 percent, while the Dow Jones Industrial Average and S&P 500 closed down 0.3 and 0.6 percent respectively.
In the energy space, global oil prices slid more than 2 percent to three-week lows on Wednesday, chalking up a three-session losing streak, on worries over rising U.S. crude stockpiles.
Meanwhile, copper fell to near two-week lows in the previous trading session, hurt by oversupply woes and slowing demand growth from China.
Mainland stocks choppy
China’s key Shanghai Composite index edged up marginally above the flatline, showing some signs of stabilization after skidding 3.5 percent to a near one-week low on Wednesday.
The CSI300 Index also shrugged off a weaker start, ticking up 0.4 percent.
On the other hand, investors rushed into small caps following Wednesday’s sharp downturn in late-day trading. The Shenzhen Composite rose 2 percent while the start-up ChiNext board moved up 2.6 percent.
Hong Kong markets reopen for trade after being shut for the Chung Yeung Festival in the previous trading session. The benchmark Hang Seng index halved losses to 0.7 percent as of 10am local time.
Shares of Air China and China Southern Airline were among the day’s top gainers, up more than 3 percent each in Shanghai, following a report by the Shanghai Securities News that both carriers are considering a merger. The Hong Kong-listed stocks of both airlines soared 4.9 and 2.8 percent respectively.
Nikkei sheds 0.5%
The rally in Japan lost steam, with the benchmark Nikkei 225 stepping back from Wednesday’s six-week highs.
Expectations for further stimulus from the Bank of Japan (BOJ) had taken the Tokyo bourse on an upward ride in the recent sessions.
Retailers were among the laggards in the morning session; Fast Retailing tanked 1.6 percent, while Aeon and Seven & i Holdingsdropped 0.6 and 0.4 percent respectively.
Blue chips were mixed, with Sony and Canon down about 0.5 percent each. But Toshiba and Mitsubishi Electric rallied more than 1 percent each.
Bucking the tepid sentiment, Nidec charged up 2.3 percent after the components maker said it was increasing capital spending to meet stronger demand for touch technology used in Apple’s iPhones. Other Apple-related stocks such as Murata and Alps Electric also climbed up more than 2 percent each.
ASX adds 0.3%
Australia’s S&P ASX 200 index recovered early losses to end higher, as battered energy counters got a rare lift from a rally in Santos shares.
The oil and gas producer surged 16.2 percent to A$6.270, coming off an intra-day high of A$6.560, following news that it had rejected a A$7.1 billion ($5.1 billion) takeover proposal from U.S.-based fund managerScepter.
Oil Search and Woodside Petroleum advanced 1.6 and 0.8 percent respectively.
However, losses in the commodity space capped the resource-heavy index’s rebound. Miners BHP Billiton and Rio Tinto eased 0.5 and 0.2 percent respectively, while Oz Minerals retreated 2.7 percent.
Gold producers weren’t spared from the meltdown after spot gold posted its biggest one-day loss in three weeks on Wednesday.Kingsgate Consolidated and Evolution Mining tumbled 5.5 and 4.6 percent respectively, while Newcrest Mining fell 3.9 percent.
Kospi loses 1%
South Korea’s Kospi index widened losses as investors digested earnings announcements by major companies.
Hyundai Motor plunged more than 2 percent after announcing a 23 percent fall in third-quarter net profit from a year ago, but shares have since recovered lost ground to slip 0.3 percent as of 1.30pm local time.
SK Hynix sold down 4.6 percent, hurt by worries over Intel’s new memory investment in China and Western Digital’s acquisition ofSanDisk. The chipmaker’s July-September operating profit met expectations with a rise of 6.3 percent from a year earlier.
The biggest loser was Samsung Engineering, which tumbled 19 percent after the company posted a record 1.5 trillion won ($1.3 billion) quarterly operating loss. The construction arm of Samsung Group also said it plans to sell new shares in a rights offering to improve its finances.
On the other hand, the bourse’s top weighted stock Samsung Electronics bounced up nearly 1 percent on the back of a report by theKorea Economic Daily that it is considering a share buyback.
LG Electronics added 0.2 percent to Wednesday’s monstrous 14 percent jump, following news that it will be supplying key components for General Motors’ upcoming electric car.
Taiex flat
Taiwan’s weighted index finished little changed, a day after profit-taking and caution ahead of third-quarter earnings by tech majors led the bourse lower.
Shares of smartphone maker HTC staged a comeback, up 4.4 percent, after sliding over 4 percent following the unveiling of its new One A9 mid-tier handset.
Eva Airways and China Airlines closed up more than 2 percent each.
In other news, Taiwan’s unemployment rate ticked up slightly to 3.79 percent in September, data from the Directorate General of Budget, Accounting and Statistics showed on Thursday, against August’s 3.74 percent.
Markets in India are closed for the Dussehra holiday.
Source: CNBC – China small-caps lead gains; rest of Asia mixed
