By V. Phani Kumar, MarketWatch
HONG KONG (MarketWatch) -- Most Asian markets rose Thursday
after key U.S. indexes clinched another record finish overnight,
although Japanese stocks skidded as a firmer yen led investors to
lock in recent gains despite strong economic growth data and upbeat
results from banks.
The Shanghai Composite , South Korea's Kospi and Taiwan's Taiex
each climbed 1%, while Hong Kong's Hang Seng Index rose 0.3%.
On the downside, Japan's Nikkei Stock Average dropped 1.1% to
14,932.31, a day after ending above the key 15,000-point level for
the first time in more than five years. Australia's S&P/ASX 200
fell 0.2% as commodity stocks weakened.
The Dow Jones Industrial Average (DJI) rallied higher Thursday
to end at its 20th record level so far in 2013. But while the
continuing rally in U.S. stocks aided sentiment, weak economic
growth in the euro zone and sluggish commodity prices kept buyers
in check after strong gains for several regional benchmarks so far
in May and this year.
Concerns about slowing growth in Asia was also in focus.
Sanjay Mathur, Royal Bank of Scotland's Asia-Pacific head of
economic research, said growth in the region excluding Japan has
"taken a turn for the worse" of late, in terms of gross domestic
product growth, exports and manufacturing indicators.
"Overall, we believe that recovery is likely to take its own
course and be moderate given the absence of either strong global
demand or fresh policy stimuli. This should ensure a period of low
inflation and pressure on corporate [profit] margins," Mathur
said.
Stock gains in Hong Kong were led by heavyweight HSBC Holdings
PLC (HBC), which climbed 1% a day after it unveiled a plan to cut
costs by up to $3 billion by 2016. The bank is planning to cut as
many as 14,000 jobs across the world.
Shares of Internet services major Tencent Holdings Ltd. (TCEHY)
jumped 5.2% after the company announced strong growth in quarterly
profit.
Those gains help offset losses in the energy sector as a
strengthening dollar weakened the outlook for prices of
commodities, including crude oil.
Shares of PetroChina Co. (PTR) lost 2% and Cnooc Ltd. (CEO) shed
1.1%.
Commodity producers also lost ground in other regional markets,
weighing in particular on Australia, where BHP Billiton Ltd. (BHP)
dropped 0.8%, gold miner Newcrest Mining Ltd. (NCMGY) tumbled 5.2%
and Oil Search Ltd. (OISHY) lost 1.2%.
A weakened Australian dollar (AUDUSD), which recently fell below
parity against the U.S. currency, also damped sentiment.
"A falling Australian dollar may put pressure on offshore
investors to sell Australian dollar-denominated assets, as they
look to preserve gains from a strengthening equity market," said
Tim Radford, a global analyst at Rivkin Securities.
In Tokyo, meanwhile, the drop came despite data released earlier
in the day showing the Japanese economy expanded at a
better-than-expected rate of 0.9% in the January to March period
from the quarter ended Dec. 31.
Banking stocks led the drop even after the country's three
largest banks posted strong results, with the Nikkei newspaper
reporting that their combined net profit for the fiscal year ended
March 31 climbed 11% due to increased lending and upbeat stock and
bond markets.
Shares of Sumitomo Mitsui Financial Group Inc. (SMFJY) dropped
2.2%, Mitsubishi UFJ Financial Group Inc. (MTU) lost 3.7% and
Mizuho Financial Group Inc. (MFG) shed 3.1%.
Some exporters also weakened as the yen (USDJPY) firmed up
against the U.S. dollar. NEC Corp. (NIPNF) fell 1.6% and Komatsu
Ltd. (KMTUF) dropped 1.5%.
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