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Aug. 25, 2016, 4:56 a.m. EDT

Asian stocks meander as investors stay on Yellen watch

Weaker oil prices put pressure on commodities-focused stock markets

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By Ese Erheriene


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Asian markets are largely just patiently hanging out, waiting for news from the Fed.

Shares in Asia lacked direction on Thursday, with investors largely on the sidelines ahead of the U.S. Federal Reserve’s annual Jackson Hole meeting, set to start later in the day.

The Nikkei Stock Average /zigman2/quotes/210597971/delayed JP:NIK +0.34%  closed down 0.3%, while the Shanghai Composite Index /zigman2/quotes/210598127/delayed CN:SHCOMP +1.84%   ended 0.6% lower. Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI -0.17%  was flat, and the South Korean Kospi /zigman2/quotes/210598069/delayed KR:180721 -0.67%  ended largely unchanged.

Traders remain fixated on what Fed Chairwoman Janet Yellen will say at her speech on Friday at the Jackson Hole meeting of central bankers, where many hope for some guidance as to when and at what pace the world’s largest economy will raise interest rates.

Read: Fed might hike interest rates despite market objections

However, some analysts say that even the expectation of guidance was wishful thinking.

“I think people are reading way, way too much into Jackson Hole,” said Kay Van-Petersen, Asia macro strategist at Saxo Capital Markets.

“There’s a lack of direction generally in the market and I think people are almost creating scenarios because they want direction. From our perspective, it just does not make sense for Yellen to posture [to one side or the other]; I think she’ll just keep the options open,” he said.

Crude effect

Energy and mining stocks fell as oil prices stumbled after weekly inventory data showed U.S. stockpiles of crude and petroleum products at a record high.

Weaker oil prices put pressure on commodities-focused stock markets, with Australia’s S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO +0.25%  ending down 0.4%, while in Malaysia, the FTSE Bursa Index /zigman2/quotes/210598052/delayed MY:FBMKLCI +0.05%  was flat.

In Japan, shares of oil and gas explorer Inpex Corp. /zigman2/quotes/206689846/delayed JP:1605 +2.88%  were down 1.6%, while Sumitomo Metal Mining Co. /zigman2/quotes/205273301/delayed JP:5713 +0.07%  tumbled 4.9%.

Among other big movers on the Nikkei, staffing agency Recruit Holdings Co. /zigman2/quotes/201433895/delayed JP:6098 -0.02%  fell 5.1% after the company said some of its existing stockholders are looking to offload shares.

The Japanese yen /zigman2/quotes/210561789/realtime/sampled USDJPY +0.7049%  was relatively flat against the U.S. dollar on Thursday in line with the wait-and-see mood, but analysts expect that the dollar could strengthen on Yellen’s coming comments. Automotive exporters benefited from that view, with Nissan Motor Co. /zigman2/quotes/208298710/delayed JP:7201 -0.04%  ending up 1.1%, and Mazda Motor Corp. /zigman2/quotes/204777714/delayed JP:7261 +1.70%  closing 1.5% higher.

In Hong Kong, the shares of Chinese oil majors came under pressure after releasing disappointing earnings the previous day. Offshore oil producer Cnooc Ltd. /zigman2/quotes/203421416/delayed HK:883 +1.16%   was trading down 0.8% after the company posted a 7.7 billion yuan ($1.16 billion) net loss, compared with a 14.7 billion yuan net profit in the first half last year.

Meanwhile, PetroChina Company Ltd. /zigman2/quotes/204979431/delayed HK:857 0.00%   was down 1.1% after its first-half net profit plunged 98% from a year earlier. The third main Chinese oil giant, Sinopec, is due to report in coming days and could spark more stock volatility, analysts say. Sinopec’s Hong Kong-traded shares /zigman2/quotes/203060554/delayed HK:338 +0.96%  were last down 0.3%.

Read: Bleak forecast for Chinese oil giants PetroChina, Cnooc

In mainland China, stock markets were down amid tighter market liquidity. China’s central bank in recent weeks has moved to reduce the amount of cheap, short-term credit in the financial system by replacing the seven-day reverse repurchase agreements — which are effectively loans to commercial banks — with 14-day ones.

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Analysts say that the expected strain on liquidity, particularly around the end of the month, spooked investors to cut positions on Thursday.

China’s central bank responded Thursday by putting more cash into the financial system, in an apparent gesture to calm a nervous market. The People’s Bank of China offered 80 billion yuan of 14-day reverse repurchase agreements in its daily money-market operation.

The nation’s money markets reacted positively to the intervention, with the weighted average of the seven-day repo rate, a benchmark measure of money market borrowing costs, falling to 2.40% from a high of 2.53% Wednesday.

/zigman2/quotes/210597971/delayed
JP : Nikkei
23,479.15
+78.45 +0.34%
Volume: 0.00
Feb. 20, 2020 3:15p
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/zigman2/quotes/210598127/delayed
CN : China: Shanghai
3,030.15
+54.75 +1.84%
Volume: 34.57B
Feb. 20, 2020 3:00p
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/zigman2/quotes/210598030/delayed
HK : Hong Kong Exchange
27,609.16
-46.65 -0.17%
Volume: 1.58M
Feb. 20, 2020 4:08p
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/zigman2/quotes/210598069/delayed
KR : Korea Exchange
2,195.50
-14.84 -0.67%
Volume: 709,563
Feb. 20, 2020 3:30p
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/zigman2/quotes/210598100/delayed
AU : S&P ASX
7,162.50
+17.90 +0.25%
Volume: 797,553
Feb. 20, 2020 5:23p
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/zigman2/quotes/210598052/delayed
MY : Malaysia
1,534.98
+0.82 +0.05%
Volume: 0.00
Feb. 20, 2020 5:05p
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/zigman2/quotes/206689846/delayed
JP : Japan: Tokyo
¥ 1,072.00
+30.00 +2.88%
Volume: 6.28M
Feb. 20, 2020 3:00p
P/E Ratio
9.97
Dividend Yield
3.36%
Market Cap
¥1521.53 billion
Rev. per Employee
¥291.81M
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/zigman2/quotes/205273301/delayed
JP : Japan: Tokyo
¥ 3,063.00
+2.00 +0.07%
Volume: 968,800
Feb. 20, 2020 3:00p
P/E Ratio
16.38
Dividend Yield
2.22%
Market Cap
¥841.11 billion
Rev. per Employee
¥134.46M
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/zigman2/quotes/201433895/delayed
JP : Japan: Tokyo
¥ 4,552.00
-1.00 -0.02%
Volume: 3.32M
Feb. 20, 2020 3:00p
P/E Ratio
39.03
Dividend Yield
0.66%
Market Cap
¥7506.21 billion
Rev. per Employee
¥57.00M
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/zigman2/quotes/210561789/realtime/sampled
US : Tullett Prebon
112.1470
+0.7850 +0.7049%
Volume: 0.0000
Feb. 20, 2020 6:29a
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/zigman2/quotes/208298710/delayed
JP : Japan: Tokyo
¥ 504.40
-0.20 -0.04%
Volume: 18.19M
Feb. 20, 2020 3:00p
P/E Ratio
47.30
Dividend Yield
1.98%
Market Cap
¥1974.57 billion
Rev. per Employee
¥85.36M
loading...
/zigman2/quotes/204777714/delayed
JP : Japan: Tokyo
¥ 898.00
+15.00 +1.70%
Volume: 3.81M
Feb. 20, 2020 3:00p
P/E Ratio
9.62
Dividend Yield
3.90%
Market Cap
¥556.10 billion
Rev. per Employee
¥71.32M
loading...
/zigman2/quotes/203421416/delayed
HK : Hong Kong
HK$ 12.22
+0.14 +1.16%
Volume: 65.31M
Feb. 20, 2020 4:08p
P/E Ratio
8.26
Dividend Yield
5.97%
Market Cap
HK$539.34 billion
Rev. per Employee
HK$13.96M
loading...
/zigman2/quotes/204979431/delayed
HK : Hong Kong
HK$ 3.42
0.00 0.00%
Volume: 70.82M
Feb. 20, 2020 4:08p
P/E Ratio
13.12
Dividend Yield
4.61%
Market Cap
HK$625.93 billion
Rev. per Employee
HK$5.32M
loading...
/zigman2/quotes/203060554/delayed
HK : Hong Kong
HK$ 2.11
+0.02 +0.96%
Volume: 7.27M
Feb. 20, 2020 4:08p
P/E Ratio
8.75
Dividend Yield
13.46%
Market Cap
HK$22.62 billion
Rev. per Employee
HK$11.81M
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