By Sarah Turner, MarketWatch
SYDNEY (MarketWatch) -- Chinese stocks slipped Tuesday, with
casino operators skidding in Hong Kong and property stocks falling
on the mainland, while Japanese blue chips also lost ground in a
mostly range-bound session for Asian markets.
Hong Kong's Hang Seng Index declined 0.8%, while the Shanghai
Composite Index fell 1.1%.
Japan's blue-chip Nikkei Stock Average slipped 0.3% to pare a
2.1% gain made in the previous session.
Elsewhere in Asia, the picture was only modestly brighter, as
South Korea's Kospi gained 0.1%, Singapore's Straits Times Index
added 0.1%, Taiwan's Taiex rose 0.2%, and Australia's S&P/ASX
200 index edged up 0.4% to build on a near four-and-a-half-year
high reached in the previous session.
"Investors [are] struggling to rediscover the bullish tone that
has pushed many regional indices to multiyear highs," said
Perpetual Investments investment market research chief Matthew
Sherwood.
Wall Street remained closed Monday for the Presidents Day
holiday, with U.S. stock futures pointing to a mildly higher start
to trading Tuesday, though action was also choppy.
Nasdaq 100 futures (NDH3) were up 1.75 points, while Dow Jones
Industrial Average futures (DJH3) rose 7 points and S&P 500
futures (SPH3) climbed 0.80 points.
Major movers
In Hong Kong, casino operators saw some big losses, with Hang
Seng Index component Sands China Ltd. (SCHYY) dropping 4.1%, and
non-component Galaxy Entertainment Group Ltd. (0027.HK) shedding
4.9%.
Analysts at Deutsche Bank said that, while Macau gaming stocks
have already risen by around 15% since the start of the year on
average, gaming revenue figures to date for February suggest that
revenue may only rise 2% year-on-year in the month. Such a result,
they said, would fall below market expectations for a 10%
year-on-year rise.
"This may be partly luck-driven and partly due to less direct
VIP play at Melco Crown Entertainment Ltd. (MPEL), which is under
Taiwan investigation," the strategists said. "The market may react
negatively to soft Chinese New Year VIP data," they added.
Still, the strategists said that if share prices sell off
further due to anti-corruption statements made at or around the
National People's Congress on March 5, for example, "we think that
will be a good buying opportunity for investors with 6-12 month
horizons, as VIP [gambling] accounts for only 30% of adjusted
operating profit (Ebitda)."
Elsewhere, shares of SCMP Group Ltd. , publisher of the South
China Morning Post newspaper, fell 6.5% after the firm said that it
was in talks over making an acquisition.
SCMP shares have risen more than 23% year-to-date, however,
after reports speculating that the firm could be taken private by
shareholder Kerry Media Ltd, controlled by Malaysian billionaire
Robert Kuok,
On the Chinese mainland, property companies were losing ground,
with Gemdale Corp. down 6.3% and Poly Real Estate Group Co. down
4.5%. Broker Citic Securities Co. fell 2.6%.
Local governments in China have been moving to tighten
homebuyers' access to credit.
Additionally, The People's Bank of China on Tuesday offered
28-day repurchase agreements to drain 30 billion yuan ($4.8
billion) from the money markets.
Crédit Agricole senior economist Dariusz Kowalczyk said the PBOC
move was a "hawkish signal" for money supply in China.
"Not surprisingly, Shanghai fell," Kowalczyk said.
In Japanese trading, stocks paused after rallying Monday on the
back of a weaker yen.
The Japanese currency fell at the start of the week after a
weekend meeting of the world's top finance ministers and central
bankers concluded without admonishing Tokyo for a recent plunge in
the yen against rivals.
However, the dollar failed to extend gains on Tuesday, trading
at Yen93.64, below its Yen93.81 level late Monday in North
America.
Reportedly helping cap the dollar's upside, Japanese Finance
Minister Taro Aso said that the government wasn't considering
purchasing foreign bonds or changing the law that governs the Bank
of Japan.
The country's Prime Minister Shinzo Abe had said Monday that if
the Bank of Japan fails to achieve its inflation target, then he
might change the central-bank law.
Currency-sensitive firms lost ground Tuesday along with the
dollar, with tech firms among the decliners. Advantest Corp. (ATE)
fell 1.3%, while Tokyo Electron Ltd. , (TOELY) gave up 2.5%, and
robotics firm Fanuc Corp. (FANUY) dropped 4.1%.
Renesas Electronics Corp. (RNECY) rose 2% in the tech sector,
however, following a Nikkei news report saying the chip maker would
appoint a new president as early as this month.
Earnings were providing a boost for some firms, with tire maker
Bridgestone Corp. (BRDCF) up 10.4% after posting a quarterly profit
of more than double that of a year earlier and forecasting record
earnings for 2013.
Earnings from Australian companies saw Mount Gibson Iron Ltd.
drop 3.9% after the iron-ore extractor said that its first-half
profit slumped to 37.1 million Australian dollars ($38.2 million)
from $129.9 million in the year-ago period. At the same time,
drinks firm Coca-Cola Amatil Ltd. rose 2% after updating
investors.
APN News & Media (APNDF) -- partly owned by Ireland's
Independent News & Media PLC -- fell 8.3% after the mass
departure of the firm's chairman, chief executive officer and three
independent directors of the board took effect Tuesday morning,
following a spat about whether to raise capital.
The departing directors wanted to announce a capital raising at
the same time as the firm's results announcement on Feb. 21, APN
said. However, shareholders Independent News & Media and Allan
Grey, holding around 51% of the firm's capital, are opposed to
raising capital at this time, it said.
South Korean trading saw telecom KT Corp. decline 1.3%.
Heavyweight electronics firm Samsung Electronics Co. (SSNLF)
recoved from earlier losses to trade up 0.1%.
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