China shares higher on liquidity boost

Photo: BBC

Beijing, China (BBN) – Asian stocks were subdued in Wednesday trade, tracking the mixed performance on Wall Street overnight. The calendar of scheduled economic data for the region is relatively light, and investors will likely keep an eye on an expected Senate vote on a U.S. tax bill.

The Nikkei 225 edged up 0.06 percent as banks and trading houses rose, reports CNBC.

Tech shares were mixed, with Nintendo sliding 0.89 percent. Japan Display bounced 4.85 percent following local media reports that it was in investment talks to potentially receive above 200 billion yen ($1.8 billion) from three Chinese companies, Reuters said.

Automaker Subaru plunged 7.24 percent after the company acknowledged a report that inspectors who had yet to be certified conducted vehicle inspections. Subaru said it would be implementing measures to restore public trust in the company. The rest of the Japanese auto sector was a mixed picture.

Meanwhile, South Korea’s benchmark Kospi index was little changed. The index was 0.06 percent lower as gains in manufacturing names offset losses in blue-chip names in other sectors. Samsung Electronics declined 1.12 percent, Hyundai Motor lost 0.65 percent and Posco rose 2.6 percent.

South Korean retailers were lower in morning trade after South Korean newspaper JoongAng Ilbo reported that visas to South Korea for Chinese tour groups had been banned once more. Lotte Shopping was down 1.53 percent and cosmetics giant Amorepacific fell 3.02 percent.

Over in Australia, the S&P/ASX 200 inched higher, climbing by 0.17 percent, with gains seen in the resources space. Mining companies continued their climb, with Rio Tinto up 0.9 percent and Atlas Iron jumping 10 percent. The telecommunications and utilities sub-indexes were lower by 0.92 percent and 0.8 percent, respectively.

Markets in greater China traded slightly lower. The Hang Seng Index was mostly steady, trading lower by 0.04 percent after gaining more than 200 points in the last session. Mainland indexes recorded moderate losses: The Shanghai Composite lost 0.04 percent and the Shenzhen Composite edged down by 0.38 percent.

House Republicans will have to vote on the GOP tax bill again after approving plans to reform the U.S. tax system by a margin of 227-203 earlier on Tuesday. The do-over is required as three provisions in the bill do not meet a procedural rule.

The Senate will likely clear the bill — which includes a provision that will see the corporate tax rate cut from 35 percent to 21 percent in 2018 — later on Tuesday U.S. time. The House, meanwhile, is expected to vote on the revised bill on Wednesday.

Wall Street declined on Tuesday after hitting record closes in previous consecutive sessions. Among notable moves in the session was a 1.1 percent fall in Apple shares after the tech giant was downgraded by Nomura Instinet.

The Dow Jones industrial average edged down 0.15 percent, or 37.45 points, to close at 24,754.75. Other major indexes recorded slightly steeper losses, with the tech-heavy Nasdaq composite shedding 0.44 percent to end at 6,963.85.

The dollar index, which tracks the U.S. currency against six major peers, was little changed, trading at 93.434 at 12:26 p.m. HK/SIN. Compared with stocks, the greenback has had a subdued reaction to tax reform optimism, although the dollar index had begun the week around the 94 handle.

Against the yen, the dollar was a touch firmer at 112.94.

In energy markets, oil prices extended gains as markets focused on the Forties Pipeline shutdown in the North Sea. Investors also awaited official information on U.S. stockpiles after the American Petroleum Institute said Tuesday that inventories had declined more than forecast.

U.S. crude gained 0.23 percent to trade at $57.69 per barrel. Brent crude futures rose 0.09 percent to trade at $63.86.


Meanwhile, bitcoin took a dive late during the U.S. Tuesday trading day, losing $1,000 in the span of an hour. CME and Cboe bitcoin futures also settled lower in the last session. The move lower also came as bitcoin platform Coinbase began letting users trade bitcoin cash.

At 12:40 p.m. HK/SIN, the cryptocurrency pared some losses to trade at $16,938.10, according to industry site CoinDesk. It had fallen as low as $15,577.74 earlier.


Japanese refiner Idemitsu Kosan soared 3.55 percent following news that it will merge crucial operations with Showa Shell Sekiyu. The companies will set up a joint office early next year in a bid to reduce costs by 30 billion yen ($266 million), Reuters reported. Showa Shell was 0.4 percent higher.

Also of note, property developer Dalian Wanda said it would establish “capital cooperation” with retailer Suning Commerce Group, the company said in a statement. Shares of the latter were up 3.15 percent

Shares of Hong Kong-listed Fosun International were off 0.61 percent following a Reuters report that the conglomerate was looking to buy a majority stake in Italian lingerie company La Perla.

Mitsubishi Materials on Tuesday said it has found additional issues relating to a data fabrication scandal at the company. In its latest update, Mitsubishi Materials said its Mitsubishi Cable Industries unit could have fabricated data on some of its magnet wires. Shares of the company were up 0.39 percent.