By Sarah Turner, MarketWatch
SYDNEY (MarketWatch) -- Asian stock markets moved broadly lower
Thursday, with weakness for property shares weighing on the Hong
Kong bourse, though Tokyo shares rose on hopes for further policy
easing.
Japan's Nikkei Stock Average ended with a 1.2% gain, after
shedding 0.9% over the past two sessions.
In China, Hong Kong's Hang Seng Index was down 0.6% in late
afternoon trading, while the Shanghai Composite Index slipped
0.1%.
Most of the other major indexes lost ground, as Australia's
S&P/ASX 200 index finished 1.2% lower, South Korea's Kospi
traded 0.3% lower just ahead of the close, and Taiwan's Taiex
dipped 0.6%.
U.S. stocks ended with small gains on Wednesday, allowing the
Dow Jones Industrial Average (DJI) to seal a nine-session streak of
gains after stronger-than-expected retail sales data for February.
Read: Stocks gain; Dow has longest win steak since 1996
The upbeat data helped the U.S. dollar (USDJPY) move back above
Yen96 overnight, with the currency moves helping many major
Japanese exporters to solid gains.
Among them, Nikon Corp. (NINOF) rallied 4.2%, Advantest Corp.
(ATE) closed 3.7% higher, and Toshiba Corp. (TOSYY) rose 1.9%.
"There is a strong correlation between moves in the yen and the
stock market, driven by the translation impact on company
earnings," said Sumitomo Mitsui Trust Bank chief Japanese-equity
portfolio manager Shigeru Oshita.
Still, that doesn't mean all exporters will benefit at the
expense of domestic plays, he said.
"During the recent strong yen period, Japanese companies split
into two categories: Good quality firms streamlined their
operations to improve their earnings structure, while others
struggled to break-even," he said.
"The simple picture whereby all exporters are beneficiaries of a
cheaper yen and all domestic firms are not, is mistaken. Bottom-up
stock picking is needed to tell the difference," he said.
On the domestic side of the Tokyo market, real estate saw
particularly strong gains, with Mitsui Fudosan Co. (8801.TO)
soaring 5.3%, and Sumitomo Realty & Development Co. (8830.TO)
chalking up a 3.8% advance.
The property sector is among those that would benefit strongly
if Japan manages to curb the deflation that has plagued its economy
for year. And hopes for fresh deflation-fighting measures from
Tokyo got a boost Thursday after Japan's lower house approved the
government's choice for central-bank governor, Haruhiko Kuroda, who
is widely seen as dovish on monetary policy.
Hong Kong property mauled
But most of the other Asia markets traded in the red Thursday,
with real-estate stocks falling sharply in Hong Kong. The losses
came as Deutsche Bank warned of sharp property-price drops ahead,
and as the state-run China Securities Journal reported that the
city of Beijing may hike taxes for home resales, among other
curbs.
Among the decliners, Henderson Land Development Co. (HLDVF)
tumbled 4%, New World Development Co. (NDVLF) fell 3.1% and Sun
Hung Kai Properties Ltd. (SUHJY) lost 3.3%.
Also weighing on the sector was news that lenders HSBC Holdings
PLC (HBC) and Standard Chartered PLC were hiking their mortgage
borrowing rates in Hong Kong, with the move expected to weigh on
the local real-estate market. Shares of HSBC gained 0.4% in Hong
Kong, while those of Standard Chartered traded 0.6% lower late in
the afternoon session.
The Deutsche Bank analysts said following the HSBC move that
"mortgage interest rates in Hong Kong could go up, even in the
absence of increases in the U.S. interest rates."
Hong Kong rates generally follow those in the U.S., as the Hong
Kong dollar is pegged to the U.S. currency.
"With the new government measures, the potential further rises
in mortgage rates, and the expected increases in new supply in the
medium term, we expect property prices to show larger corrections,
and we expect Hong Kong home prices to fall by 15%-20% in the next
24 months," the analysts said.
In mainland Chinese trading, the real-estate sector saw less
extreme losses, as the nation's top property developer China Vanke
Co. fell 1.9% in Shenzhen, and rival Poly Real Estate Group Co.
rose 0.8% in Shanghai.
Meanwhile, major Hang Seng Index component China Mobile Ltd.
(CHL) managed to gain 0.1% in late trading after posting a modest
2.7% rise in 2012 profit, but also hiking its dividend.
Australian investors welcomed first-half results from
department-store retailer Myer Holdings Ltd. , sending the firm's
shares soaring 5.9%.
The Sydney benchmark index turned briefly positive after
Australian employment data surprised to the upside, but losses for
miners worked to drag it back to negative territory.
Among the big mining names, Rio Tinto Ltd. (RIO) and BHP
Billiton Ltd. (BHP) each closed the day with a 2.3% loss, while
Fortescue Metals Group Ltd. (FSUMY) plunged 6.2%.
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