By Daniel Inman
Asian stocks achieved strong gains for the week, especially in Southeast Asia, though regional markets were mostly lower on Friday ahead of next week’s key Federal Reserve policy meeting.
Stocks across Asia posted healthy returns since last Friday, as further signs of an economic recovery in China combined with lower expectations of U.S. military intervention in Syria supported regional risk sentiment.
Notable events during the week include Australia closing at a more than five-year high on Wednesday and the Shanghai Composite enjoying its biggest percentage gain so far in 2013 on Monday.
Some of the best performers were in Southeast Asia, where markets have had a turbulent summer — the result of fears that the U.S. Federal Reserve could scale back its bond-buying program, which induced several sell-offs as investors pulled money out of these small markets.
On Friday, a negative lead from Wall Street and a lack of regional trading cues weighed on Asia. Markets are already anticipating next week’s Fed policy meeting, where some expect the central bank to start removing stimulus.
The sharpest losses were recorded in China, where the Shanghai Composite fell 1%, as cyclical shares that have rallied in recent sessions pulled back.
Firms that have surged in recent sessions on expectations of greater profits from the forthcoming Shanghai Free Trade Zone also retreated on Friday: Shanghai International Port (Group) /zigman2/quotes/206894803/delayed CN:600018 -1.68% slid 4.6%.
Australia’s S&P/ASX 200 fell 0.4% and South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 +1.18% was down 0.5%.
Japan’s Nikkei /zigman2/quotes/210597971/delayed JP:NIK -3.34% slipped 0.5% as investors consolidated their positions before the upcoming three-day weekend.
The U.S. dollar /zigman2/quotes/210561789/realtime/sampled USDJPY -0.0795% managed to claw back some of its overnight losses against its Japanese counterpart in Asian trade — last at ¥99.63, compared with ¥99.53 late Thursday in New York.
General contractors were among the most heavily traded stocks in Tokyo amid lingering Olympic enthusiasm. Sumitomo Mitsui Construction Co. /zigman2/quotes/209399589/delayed JP:1821 -4.81% rose 4.6%, Tekken Corp. /zigman2/quotes/204213949/delayed JP:1815 -3.66% fell 1% and Daiho Corp. /zigman2/quotes/205715063/delayed JP:1822 -4.34% was down 0.7%.
Convenience store operator Seven & I Holdings Co. /zigman2/quotes/207666111/delayed JP:3382 -1.22% moved 0.7% higher after a Nikkei report said that the firm’s consolidated operating profit for the fiscal half year ending Aug. 31 will probably rise to a record high.
Chinese stocks edged lower, with the Shanghai Composite down 0.2% and the Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +0.27% down 0.2% in Hong Kong.
Gold fell another 0.3% in Asia to $1,326.30 an ounce, after a 2.5% overnight sell-off. Shares in regional gold miners followed the price of the precious metal lower: Newcrest Mining /zigman2/quotes/203840223/delayed AU:NCM -3.58% /zigman2/quotes/206026738/delayed NCMGF -1.14% lost 2.8% in Sydney, Zhaojin Mining Industry Co. /zigman2/quotes/203361399/delayed HK:1818 -3.89% /zigman2/quotes/200275285/delayed ZHAOF +0.77% and Zijin Mining Group Co. /zigman2/quotes/204517000/delayed HK:2899 -4.68% /zigman2/quotes/209836076/delayed ZIJMF -0.80% lost 6.7% and 3.8%, respectively, in Hong Kong.