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July 22, 2013, 5:06 a.m. EDT

Asian stocks rise; Japan gets election boost

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By V. Phani Kumar, MarketWatch

HONG KONG (MarketWatch) — Asian markets advanced Monday after China removed a floor on banks’ lending rates and Japan’s ruling government regained control of the parliament’s upper house, raising hopes for further reforms in both economies.

Japan’s Nikkei Stock Average /zigman2/quotes/210597971/delayed JP:NIK -0.23%  rose 0.5%, the Shanghai Composite /zigman2/quotes/210598127/delayed CN:SHCOMP -0.04% added 0.6% and Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI -0.47% edged 0.3% higher, with each overcoming volatility that dragged them into losses earlier in the day.

“Longer-term investors will take heart from the improved potential for structural reform in Japan and China’s abolition of minimum bank lending rates,” said CMC Markets chief market analyst Ric Spooner.


Shutterstock Enlarge Image
Japan stocks rise after the Liberal Democratic Party regains control of the upper house of parliament in weekend elections.

The performance in Tokyo came after the ruling Liberal Democratic Party’s coalition easily won a majority of the 121 seats contested in the upper house elections over the weekend. The victory gave Prime Minister Shinzo Abe’s LDP control over both houses, consolidating its political power.

Telecommunication and insurance shares advanced, although a strengthened yen weighed on some exporters.

Shares of Softbank Corp. /zigman2/quotes/207303954/delayed JP:9984 +0.05%   /zigman2/quotes/202815238/delayed SFTBF +1.35%  climbed 0.9%, Nippon Telegraph & Telephone Corp. /zigman2/quotes/200718273/delayed JP:9432 +1.45%  gained 1.3%, and MS&AD Insurance Group Holdings Inc. /zigman2/quotes/203653851/delayed JP:8725 +0.26%   /zigman2/quotes/209008763/delayed MSADY +0.70%  rose 1%.

On the downside, Nissan Motor Corp. /zigman2/quotes/208298710/delayed JP:7201 +2.35% /zigman2/quotes/207656007/delayed NSANY +2.25% eased 0.7%, Mitsubishi Heavy Industries Ltd. /zigman2/quotes/202419396/delayed JP:7011 +1.55%   /zigman2/quotes/206985358/delayed MHVYF -2.00%  retreated 4.1%, and Renesas Electronics Corp. /zigman2/quotes/203872935/delayed JP:6723 +0.70%   /zigman2/quotes/201351352/delayed RNECY +2.29%  dropped 3.4%, as the U.S. dollar /zigman2/quotes/210561789/realtime/sampled USDJPY +0.0231% fell to around the ¥100-level.

Click to Play

Big victory for Japan's Prime Minister Shinzo Abe

Japanese Prime Minister Shinzo Abe's ruling bloc wins a majority in Sunday's upper-house election.

HSBC’s co-head of Asian economic research Frederic Neumann said the real test for Prime Minister Abe’s administration lay ahead, as he must urgently implement far-reaching reforms to revive the economy.

“No matter whether [Abe] succeeds in the coming quarters or not, there is one effect that will be keenly felt: Japanese money will increasingly wash over Asia,” he wrote in a note to clients.

Chinese shares turned volatile, meanwhile, as analysts said the People’s Bank of China’s decision late Friday to abandon a floor on the rates bank could charge on their loans marked a structural reform, but one that wouldn’t significantly affect bank earnings nor provide help to the economy.

“We believe this is the easy part of interest-rate deregulation, but nevertheless is an important first step in the right direction for structural reforms,” Credit Suisse economist Dong Tao wrote in a report. “Removing the deposit-rate ceiling would be more significant to the economy and banking sector than removing the floor to the lending rate.”

China currently caps the interest rates that banks pay on deposits, a factor that often pushes savers toward riskier investments in search of higher returns.

/zigman2/quotes/202525815/delayed 601398 5.57, +0.12, +2.20%
/zigman2/quotes/208058581/delayed 601939 7.46, +0.01, +0.13%
/zigman2/quotes/210598127/delayed SHCOMP 3,501.99, -1.50, -0.04%
One-year percentage changes
A-shares of Industrial Commercial Bank of China and China Construction Bank Vs. Shanghai Composite

Credit ratings agency Moody’s Investors Service said that while the removal of the lending rate marked an important step in China’s financial reforms, removal of the lending rate floor was a credit negative for banks. “It is another move towards interest rate deregulation that will narrow their net interest margins,” Moody’s said.

In Monday trade, shares of China Construction Bank Corp. /zigman2/quotes/208058581/delayed CN:601939 +0.13%   /zigman2/quotes/207732534/delayed CICHY +3.20%  lost 0.2%, and those of Industrial & Commercial Bank of China Ltd. /zigman2/quotes/202525815/delayed CN:601398 +2.20% /zigman2/quotes/202401350/delayed IDCBY +4.74% shed 0.5% in Shanghai.

Shares of metals companies advanced after gold and copper prices rose Friday in the U.S. Jiangxi Copper Co. /zigman2/quotes/201334192/delayed CN:600362 -1.80% /zigman2/quotes/204256025/delayed JIXAY +31.60% climbed 2% and Zijin Mining Group Co. /zigman2/quotes/203833875/delayed CN:601899 -3.93% /zigman2/quotes/209836076/delayed ZIJMF +2.96%  added 2.5% in Shanghai; in Hong Kong, Zhaojin Mining Industry Co. /zigman2/quotes/203361399/delayed HK:1818 -3.12%   /zigman2/quotes/200275285/delayed ZHAOF +0.92% rose 4.5% and China Molybdenum Co. /zigman2/quotes/202330604/delayed HK:3993 -9.36%  advanced 1.1%.

Elsewhere, Australia’s S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO -0.74%  rose 0.6% and South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 -0.57%  added 0.5%, with the Australian shares propped up by the mining and financial sectors.

Commonwealth Bank of Australia /zigman2/quotes/200638713/delayed AU:CBA +0.08%   /zigman2/quotes/207018701/delayed CBAUF -0.71% gained 0.6%, and Macquarie Group Ltd. /zigman2/quotes/206727308/delayed AU:MQG -1.52% /zigman2/quotes/204353811/delayed MCQEF -0.88% rose 3.3%, while gold miner Newcrest Mining Ltd. /zigman2/quotes/203840223/delayed AU:NCM -0.85%   /zigman2/quotes/206026738/delayed NCMGF -1.20%  jumped 7.5%.

Asia’s performance came after the Standard & Poor’s 500 Index /zigman2/quotes/210599714/realtime SPX +1.95% marked modest gains in the U.S. on Friday, though weakness for Microsoft Corp. /zigman2/quotes/207732364/composite MSFT +2.15%  helped drag down the Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA +1.85% .

/zigman2/quotes/210597971/delayed
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28,864.32
-65.79 -0.23%
Volume: 0.00
March 5, 2021 3:15p
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/zigman2/quotes/210598127/delayed
CN : China: Shanghai
3,501.99
-1.50 -0.04%
Volume: 35.64B
March 5, 2021 3:01p
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/zigman2/quotes/210598030/delayed
HK : Hong Kong Exchange
29,098.29
-138.50 -0.47%
Volume: 4.00M
March 5, 2021 4:09p
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JP : Japan: Tokyo
¥ 10,055.00
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Market Cap
¥18115.54 billion
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¥76.45M
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US : U.S.: OTC
$ 93.20
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Market Cap
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$703,100
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/zigman2/quotes/200718273/delayed
JP : Japan: Tokyo
¥ 2,761.50
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Market Cap
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/zigman2/quotes/203653851/delayed
JP : Japan: Tokyo
¥ 3,087.00
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Volume: 1.82M
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4.86%
Market Cap
¥1741.05 billion
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¥120.50M
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/zigman2/quotes/209008763/delayed
US : U.S.: OTC
$ 14.35
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Volume: 25,814
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P/E Ratio
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Market Cap
$16.08 billion
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$1.11M
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/zigman2/quotes/208298710/delayed
JP : Japan: Tokyo
¥ 604.20
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P/E Ratio
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Market Cap
¥2364.32 billion
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US : U.S.: OTC
$ 11.35
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P/E Ratio
N/A
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Market Cap
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/zigman2/quotes/202419396/delayed
JP : Japan: Tokyo
¥ 3,266.00
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P/E Ratio
N/A
Dividend Yield
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Market Cap
¥1097.71 billion
Rev. per Employee
¥49.51M
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/zigman2/quotes/206985358/delayed
US : U.S.: OTC
$ 29.65
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Volume: 2,542
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P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$10.14 billion
Rev. per Employee
$455,346
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/zigman2/quotes/203872935/delayed
JP : Japan: Tokyo
¥ 1,149.00
+8.00 +0.70%
Volume: 15.53M
March 5, 2021 3:00p
P/E Ratio
44.19
Dividend Yield
N/A
Market Cap
¥1990.32 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/201351352/delayed
US : U.S.: OTC
$ 5.35
+0.12 +2.29%
Volume: 59,840
March 5, 2021 3:56p
P/E Ratio
44.00
Dividend Yield
N/A
Market Cap
$18.39 billion
Rev. per Employee
N/A
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/zigman2/quotes/210561789/realtime/sampled
US : Tullett Prebon
108.4050
+0.0250 +0.0231%
Volume: 0.0000
March 5, 2021 4:59p
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/zigman2/quotes/208058581/delayed
CN : China: Shanghai
¥ 7.46
+0.01 +0.13%
Volume: 184.97M
March 5, 2021 3:00p
P/E Ratio
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Dividend Yield
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Market Cap
¥1373.19 billion
Rev. per Employee
¥3.15M
loading...
/zigman2/quotes/207732534/delayed
US : U.S.: OTC
$ 16.76
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Volume: 87,069
March 5, 2021 3:45p
P/E Ratio
5.88
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4.55%
Market Cap
$212.01 billion
Rev. per Employee
$455,946
loading...
/zigman2/quotes/202525815/delayed
CN : China: Shanghai
¥ 5.57
+0.12 +2.20%
Volume: 478.77M
March 5, 2021 3:00p
P/E Ratio
6.86
Dividend Yield
4.72%
Market Cap
¥1897.79 billion
Rev. per Employee
¥2.88M
loading...
/zigman2/quotes/202401350/delayed
US : U.S.: OTC
$ 14.13
+0.64 +4.74%
Volume: 47,279
March 5, 2021 3:45p
P/E Ratio
6.10
Dividend Yield
4.37%
Market Cap
$293.01 billion
Rev. per Employee
$416,033
loading...
/zigman2/quotes/201334192/delayed
CN : China: Shanghai
¥ 25.04
-0.46 -1.80%
Volume: 75.78M
March 5, 2021 3:00p
P/E Ratio
44.84
Dividend Yield
0.40%
Market Cap
¥71.02 billion
Rev. per Employee
¥10.32M
loading...
/zigman2/quotes/204256025/delayed
US : U.S.: OTC
$ 90.91
+21.83 +31.60%
Volume: 1.00
March 5, 2021 10:51a
P/E Ratio
28.49
Dividend Yield
0.53%
Market Cap
$10.96 billion
Rev. per Employee
$1.49M
loading...
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CN : China: Shanghai
¥ 11.00
-0.45 -3.93%
Volume: 532.96M
March 5, 2021 3:00p
P/E Ratio
47.09
Dividend Yield
0.91%
Market Cap
¥266.97 billion
Rev. per Employee
¥6.72M
loading...
/zigman2/quotes/209836076/delayed
US : U.S.: OTC
$ 1.39
+0.04 +2.96%
Volume: 79,841
March 5, 2021 3:41p
P/E Ratio
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Dividend Yield
N/A
Market Cap
$41.22 billion
Rev. per Employee
$973,049
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/zigman2/quotes/203361399/delayed
HK : Hong Kong
HK$ 7.46
-0.24 -3.12%
Volume: 8.74M
March 5, 2021 4:08p
P/E Ratio
33.57
Dividend Yield
0.58%
Market Cap
HK$24.40 billion
Rev. per Employee
HK$1.06M
loading...
/zigman2/quotes/200275285/delayed
US : U.S.: OTC
$ 1.10
+0.01 +0.92%
Volume: 0.00
Feb. 19, 2021 9:46a
P/E Ratio
38.60
Dividend Yield
N/A
Market Cap
$3.56 billion
Rev. per Employee
$135,414
loading...
/zigman2/quotes/202330604/delayed
HK : Hong Kong
HK$ 5.23
-0.54 -9.36%
Volume: 146.45M
March 5, 2021 4:08p
P/E Ratio
45.80
Dividend Yield
0.90%
Market Cap
HK$149.33 billion
Rev. per Employee
HK$6.88M
loading...
/zigman2/quotes/210598100/delayed
AU : S&P ASX
6,710.80
-49.90 -0.74%
Volume: 702,246
March 5, 2021 5:05p
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/zigman2/quotes/210598069/delayed
KR : Korea Exchange
3,026.26
-17.23 -0.57%
Volume: 1.19M
March 5, 2021 3:32p
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/zigman2/quotes/200638713/delayed
AU : Australia: Sydney
$ 86.45
+0.07 +0.08%
Volume: 3.13M
March 5, 2021 4:10p
P/E Ratio
19.25
Dividend Yield
2.87%
Market Cap
$153.22 billion
Rev. per Employee
$917,769
loading...
/zigman2/quotes/207018701/delayed
US : U.S.: OTC
$ 65.65
-0.47 -0.71%
Volume: 252.00
March 5, 2021 9:30a
P/E Ratio
21.04
Dividend Yield
N/A
Market Cap
$117.42 billion
Rev. per Employee
$615,248
loading...
/zigman2/quotes/206727308/delayed
AU : Australia: Sydney
$ 144.20
-2.23 -1.52%
Volume: 1.04M
March 5, 2021 4:10p
P/E Ratio
23.34
Dividend Yield
2.56%
Market Cap
$49.90 billion
Rev. per Employee
$1.01M
loading...
/zigman2/quotes/204353811/delayed
US : U.S.: OTC
$ 112.00
-1.00 -0.88%
Volume: 112.00
March 5, 2021 9:35a
P/E Ratio
26.80
Dividend Yield
N/A
Market Cap
$39.70 billion
Rev. per Employee
$685,026
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/zigman2/quotes/203840223/delayed
AU : Australia: Sydney
$ 23.24
-0.20 -0.85%
Volume: 2.88M
March 5, 2021 4:10p
P/E Ratio
13.40
Dividend Yield
1.82%
Market Cap
$18.94 billion
Rev. per Employee
$6.29M
loading...
/zigman2/quotes/206026738/delayed
US : U.S.: OTC
$ 18.15
-0.22 -1.20%
Volume: 424.00
March 5, 2021 1:23p
P/E Ratio
15.12
Dividend Yield
N/A
Market Cap
$14.51 billion
Rev. per Employee
$4.22M
loading...
/zigman2/quotes/210599714/realtime
US : S&P US
3,841.94
+73.47 +1.95%
Volume: 3.33B
March 5, 2021 5:44p
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/zigman2/quotes/207732364/composite
US : U.S.: Nasdaq
$ 231.60
+4.87 +2.15%
Volume: 41.87M
March 5, 2021 4:00p
P/E Ratio
34.49
Dividend Yield
0.97%
Market Cap
$1746.78 billion
Rev. per Employee
$877,393
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/zigman2/quotes/210598065/realtime
US : Dow Jones Global
31,496.30
+572.16 +1.85%
Volume: 505.35M
March 5, 2021 5:44p
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Varahabhotla Phani Kumar is a reporter in MarketWatch's Hong Kong bureau. Follow him on Twitter @MktwKumar.

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