HONG KONG (MarketWatch) — Most Asian markets fell Monday as caution prevailed ahead of this week’s Greek parliamentary vote on austerity measures, with energy stocks shrinking on weaker oil prices and some banks dropping on concern about a harsher regulatory climate.
“Markets globally are firmly fixated on one thing and one thing only — the Greek debt crisis and whether or not the Greek parliament will vote in favor of the latest austerity plan,” said Ben Potter, market strategist at IG Markets. “At the moment, there is simply too much ‘overnight risk.’”
Japan’s Nikkei Stock Average /zigman2/quotes/210597971/delayed JP:NIK -0.24% ended the session with a 1% loss at 9,578.31, Australia’s S&P/ASX 200 index /zigman2/quotes/210598100/delayed AU:XJO +1.44% also dropped 1% to 4,461.80 and Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +0.88% lost 0.6% to 22,041.77.
South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 +1.44% fell 1% and Taiwan’s Taiex declined 0.4%.
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The world’s top central bankers said after a meeting over the weekend that larger, systemically important banks should carry an extra capital buffer. That weighed on some regional banks, due to fears about the possible impact on the world’s major lenders. Read report on Basel’s call for larger capital requirements.
HSBC Holdings PLC /zigman2/quotes/203901799/delayed UK:HSBA +0.20% /zigman2/quotes/202687335/delayed HK:5 +1.38% , fell 1.5% in Hong Kong, Commonwealth Bank of Australia /zigman2/quotes/200638713/delayed AU:CBA +1.24% /zigman2/quotes/207018701/delayed CBAUF +7.62% gave up 1.3% in Sydney and KB Financial Group Inc. shed 1.4% in Seoul.
Some Japanese banks came off their early weakness, however, with Mitsubishi UFJ Financial Group Inc. /zigman2/quotes/207520099/delayed JP:8306 -0.49% ending little changed, while Sumitomo Mitsui Financial Group Inc. /zigman2/quotes/203656770/delayed JP:8316 +0.26% /zigman2/quotes/206471416/composite SMFG -1.19% adding 0.2%.
Analysts at Deutsche Bank said that Japan’s three largest banks were likely to comply with the stricter capital norms by 2019, without having to issue new capital.
Taking a different route from its Asia counterparts, the Shanghai Composite Index /zigman2/quotes/206600939/delayed CN:000001 -0.78% edged up 0.4% to advance for a fifth straight day. That rise helped Hong Kong shares pare initial losses.
“Overall, I think that Hong Kong stocks are actually going to be a little more stable in the short-term, as there are some opinions that inflation in China will be under control,” said Linus Yip, a strategist at First Shanghai Securities.
Yip added that while investors are still cautious ahead of the Greek parliamentary vote, some were optimistic that the nation will be able to secure funding from the European Union and the International Monetary Fund to tide it over its debt troubles.
In afternoon trading, India’s Sensex rose 0.9% and Singapore’s Straits Times Index slipped 0.6%.
In addition to Europe’s debt crisis, disappointing results from the U.S.’s Oracle Corp. /zigman2/quotes/202180826/composite ORCL +3.19% helped send the Nasdaq /zigman2/quotes/210598365/realtime COMP +2.58% down 1.3%, which pressured Asian technology stocks.
Tech firms trading in the red in Tokyo included Sony Corp. /zigman2/quotes/201361720/delayed JP:6758 +0.58% /zigman2/quotes/208567357/composite SNE +2.39% , down 2.1%, and Elpida Memory Inc. , trading 2% lower. In Seoul, Samsung Electronics Co. /zigman2/quotes/202367843/delayed SSNLF 0.00% dropped 2%. Inotera Memories Inc. slid 3.7% and Taiwan Semiconductor Manufacturing Co. /zigman2/quotes/204359850/composite TSM +1.11% shed 1.2% in Taipei.
The losses in Tokyo came amid concern that the Bank of Japan’s quarterly tankan survey, to be released Friday, was likely to show a sharp deterioration in business sentiment.
Meanwhile, a drop in crude-oil prices sent energy shares downward. Japan Petroleum Exploration Co. /zigman2/quotes/201212147/delayed JP:1662 +2.25% /zigman2/quotes/202925532/delayed JPTXF -1.12% lost 2.4% and Inpex Corp. /zigman2/quotes/206689846/delayed JP:1605 +1.59% /zigman2/quotes/207958170/delayed IPXHY +1.85% lost 1% in Tokyo. Cnooc Ltd. /zigman2/quotes/203421416/delayed HK:883 +2.42% /zigman2/quotes/204964401/composite CEO +0.79% slipped 1.3% in Hong Kong, and Santos Ltd. /zigman2/quotes/207349564/delayed AU:STO +3.83% /zigman2/quotes/207933640/delayed STOSF +17.59% was down 2.5% in Sydney.
After Brent crude-oil dropped 7.7% in two days following last week’s strategic-reserve release, Barclays Capital strategists said Monday: “Although some of the price movement likely reflects technical portfolio adjustments, it is revealing that Brent has moved back to levels last seen in February, possibly signaling weakness in demand.” Read more on oil
But Indian refiners jumped after the government on Friday raised diesel prices for the first time in several months, with Bharat Petroleum Corp. /zigman2/quotes/204002483/delayed IN:500547 -2.55% adding 4.8% and Indian Oil Corp. /zigman2/quotes/204309127/delayed IN:530965 -1.39% climbing 3.4% in afternoon trading.
Some regional airlines also gained on the lower oil prices, with Air China Ltd. /zigman2/quotes/203341301/delayed CN:601111 +1.93% /zigman2/quotes/207207351/delayed AIRYY -0.77% /zigman2/quotes/203408003/delayed HK:753 +1.99% jumping 5% and China Eastern Airlines Corp. /zigman2/quotes/208816122/delayed CN:600115 +1.67% /zigman2/quotes/210281798/delayed CHEAF -1.28% /zigman2/quotes/203578936/delayed HK:670 +2.13% advancing 4.4% in Hong Kong, Jet Airways India Ltd. /zigman2/quotes/207344849/delayed IN:532617 +4.99% gaining 0.9% and Qantas Airways Ltd. /zigman2/quotes/205534063/delayed AU:QAN +4.92% /zigman2/quotes/200387630/delayed QUBSF -4.08% adding 1.9% in Sydney.