MUMBAI (MarketWatch) — Asian shares mostly lost ground on Friday, with investors taking a lead from the U.S. and sending technology stocks lower, although emerging monetary-policy support helped lift China.
South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 -0.81% led the region lower with a 1.3% loss as a poor earnings report from LG Chem weighed. In Tokyo, the Nikkei Stock Average /zigman2/quotes/210597971/delayed JP:NIK -1.06% fell 0.3%.
In China, however, the Shanghai Composite Index /zigman2/quotes/206600939/delayed CN:000001 -4.31% ended with a 1.2% gain, while Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI -1.84% rose 0.1%.
Australia’s S&P/ASX 200 index /zigman2/quotes/210598100/delayed AU:XJO -0.61% gained 0.1%.
“I think that Asian markets right now have already factored in some short-term unfavorable factors. Markets are stabilizing, and easing of monetary policy is already on the way,” said Linus Yip, strategist at First Shanghai Securities in Hong Kong.
“India has already cut rates, and China is still going for easing policy. So Asian markets as a whole I think will enter into a rebound in the next couple of weeks,” Yip said.
Still, any bounce will likely be limited for Asian equity markets, Yip believes, unless signs emerge of more U.S. central bank action.
“The market is waiting for more liquidity — whether there will be [...] QE3 in the U.S.,” he said.
U.S. shares took a second straight day of losses Thursday, as jobless claims hovered around a four-month high and as Europe’s debt woes cast a cloud over markets. Read U.S. Market Snapshot.
Chinese shoppers seek bargains overseas, says LVMH
Chinese consumers are snapping up Louis Vuitton handbags but are increasingly buying them abroad, where prices are lower, raising concerns that the luxury-goods industry is headed for a slowdown in China. Photo: Getty
“We believe the jury is still very much out on what direction things will take in peripheral [European] countries in the coming months. With a number of event risks, volatility is likely to remain elevated for the time being,” said strategists at Barclays Capital.
Overnight weakness in U.S. techs, with sharp falls for Apple Inc. /zigman2/quotes/202934861/composite AAPL +0.36% and EMC Corp. casting a shadow over the Japanese technology sector.
Toshiba Corp. /zigman2/quotes/205628942/delayed JP:6502 -1.27% /zigman2/quotes/204149068/delayed TOSYY -1.58% dropped 2.4%, Advantest Corp. /zigman2/quotes/206869087/delayed JP:6857 +0.87% /zigman2/quotes/202479540/delayed ADTTF +1.36% traded down 0.3%, and Fujitsu Ltd. /zigman2/quotes/208459594/delayed JP:6702 -1.29% /zigman2/quotes/208783738/delayed FJTSY +0.72% moved lower by 2.5%.
The Korean market also felt the weight of tech-share losses, with semiconductor giant Samsung Electronics Co. /zigman2/quotes/202367843/delayed SSNLF 0.00% down 1.9%, LG Electronics Inc. off 1.5%, and SK Hynix Inc. losing 4%.
LG Chem Ltd. tumbled 9.2% in Seoul after unveiling a much weaker-than-expected 42% drop in first-quarter net profit compared to the year-ago period. Elsewhere in the sector, Honam PetroChemical Corp. fell 8.3%.
In Hong Kong trading, Internet major Tencent Holdings Ltd. /zigman2/quotes/204605823/delayed HK:700 -2.93% /zigman2/quotes/202617460/delayed TCTZF +0.37% fell 1.4%, while shares of Foxconn International Holdings Ltd. /zigman2/quotes/205017351/delayed HK:2038 -1.06% /zigman2/quotes/207122890/delayed FXCNF +2.80% dropped 2.7%.
Hong Kong-listed financials mostly recovered from early weakness by the close. Bank of Communications Co. /zigman2/quotes/203442771/delayed HK:3328 -1.88% /zigman2/quotes/208048873/delayed BKFCF -1.69% /zigman2/quotes/207155262/delayed CN:601328 -2.87% was off 0.5%, and Bank of China Ltd. /zigman2/quotes/204682472/delayed HK:3988 -1.40% /zigman2/quotes/201568493/delayed BACHY -1.94% /zigman2/quotes/209359942/delayed CN:601988 -2.65% finished flat, with both lenders due to report earnings next week.
Insurer AIA Group Ltd. /zigman2/quotes/203565558/delayed HK:1299 -1.83% /zigman2/quotes/205179901/delayed AAGIY -1.66% was unchanged after reporting strong operational data for the first quarter. Read more on AIA’s report.
Among Asian energy and materials firms, Hong Kong-listed oil giant Cnooc Ltd. /zigman2/quotes/203421416/delayed HK:883 -1.48% /zigman2/quotes/204964401/composite CEO -3.11% fell 0.6%, and Jiangxi Copper Co. /zigman2/quotes/201668148/delayed HK:358 -4.57% /zigman2/quotes/207419243/delayed JIAXF +9.47% shed 0.9%.
Japan’s JFE Holdings Inc. /zigman2/quotes/204336633/delayed JP:5411 -3.60% /zigman2/quotes/203557603/delayed JFEEF -11.43% lost 3.3% in Tokyo after a Nikkei report saying the steel maker planned to increase its three-year investment target by 25%.
In Australian trading, miners were weak, though they recovered ground by the close. Fortescue Metals Group Ltd. /zigman2/quotes/202351558/delayed AU:FMG -0.13% /zigman2/quotes/204116626/delayed FSUMF +1.21% fell 1.1%, and BHP Billiton Ltd. /zigman2/quotes/201448516/delayed AU:BHP -0.74% /zigman2/quotes/208108397/composite BHP -1.19% finished unchanged.
Also in Sydney, U.S.-exposed building-materials firm Boral Ltd. /zigman2/quotes/208897707/delayed AU:BLD -1.08% /zigman2/quotes/203993899/delayed BOALF -1.90% dropped 2.9% after it cut its fiscal-year profit guidance, citing bad weather and a softer housing market. See report on Boral’s cut to profit outlook.