ASIA AND AUSTRALIA EQUITY ENDED WITH MIX NOTE
The Nikkei 225 Index gained 0.25% to close at 28,893 while the broader Topix Index edged higher by 0.08% to 2,001 on Friday, after recouping the day’s sharp early losses as investors remained cautious ahead of Japan’s Oct. 31 general election. Recent polls came in with mixed results, with a Yomiuri daily survey showing the Liberal Democratic Party may fall short of majority, while the Asahi daily poll predicted the ruling party would lose seats but come in well above 233. Technology, consumer, shipping and manufacturing firms lifted the indices to positive territory, led by gains in Fuji Electric (11.78%), Nippon Yusen (6.79%), Mitsui O.S.K. (9.48%), Kawasaki Kisen (7.03%) and Omron Corp (3.13%).
Mainland Chinese stocks closed higher on Friday, with the Shanghai Composite Index up 0.82% to 3,547 while the Shenzhen Component rallied 1.45% to 14,451, after technology firms in the semiconductor and electrification industries lifted the market, while property stocks dragged amid concerns over a real estate tax scheme and credit rating downgrades. Some of the market’s notable gainers include Longi Green Energy (9.62%), Contemporary Amper (5.27%), BYD Company (1.08%), TBEA Co (4.69%) and Tianjin Zhonghua (5.46%). Meanwhile, China’s stock indices ended the week lower as investors grappled with concerns including a resurgence of coronavirus cases, an ongoing debt crisis in the property sector, government intervention in the coal industry and rising risk of US tension.
The BSE Sensex retreated by 677.77 points or 1.13% to close at 59,306.93 on Friday, falling for the third consecutive session, dragged down by banks, IT and capital goods. Among the individual stocks, Tech Mahindra slumped the most (-3.53%), followed by National Thermal Power Corporation(-3.05%) and IndusInd Bank (-2.62%). On the week, the BSE fell by 2.5%.
The S&P/ASX 200 dropped 1.44% to close at 7,324 on Friday, snapping 3 weeks of gains as the Reserve Bank of Australia lost control of its yield target, sending bond yields to rise at their quickest pace in decades. The April 2024 Australian government bond surged to 0.75% on Friday, fueling expectations that policy makers may abandon its 0.1% target as early as next week. The central bank’s yield targets are central to its assertion that interest rates will remain low until 2024. Major sectors across the board succumbed to market selling including banks, miners and technology firms. Meanwhile, Vulcan Energy plunged 16.54% after failing to fend off short sellers amid accusations that the lithium company’s flagship Zero Carbon Lithium Project in Germany may never get under way amid high costs, lower output than disclosed and low lithium resources.
The NZX 50 Index gained 1% to close at 13,100 on Friday, erasing three days of losses to end the week slightly higher by 0.05%, as government yields eased and as stocks adjusted to the new policy environment. New Zealand equities have been under constant pressure from rising yields as persistent inflationary pressures pushed the market to bet on a more aggressive tightening from the Reserve Bank of New Zealand. The benchmark 10 year yield however eased on Friday after RBNZ Governor Adrian Orr acknowledged that “monetary policy has largely run its course globally,” and added “we are now entering a different environment for rates, inflation.” Gains in the market were led by Pushpay (4%), A2 Milk (3%), Air New Zealand (3%), Port Tauranga (3%) and Synlait Milk (3%), among others.
