WPLCD Woodside Petroleum Ltd

Asian shares were broadly lower Monday morning, with the Nikkei giving up early gains, driven by a sharp decline in electric utilities stocks after a nuclear-power skeptic's weekend win in a Japanese gubernatorial race.

The Nikkei Stock Average was recently flat, after gaining as much as 0.5% earlier in the session. Elsewhere in the region, Hong Kong's Hang Seng Index was off 0.8%, Australia's S&P/ASX 200 fell 0.4%, and Korea's Kospi declined 0.1%.

"Most investors will continue to be cautious and focus on economic data," said Castor Pang, head of research at Core Pacific-Yamaichi International. He said regional markets will watch key economic data for signs of what action the U.S. Federal Reserve might take on interest rates before the end of the year.

In Japan, stocks were initially boosted by gains in U.S. financial stocks on Friday, after lenders J.P. Morgan Chase & Co., Citigroup Inc. and Wells Fargo & Co. reported earnings that beat analysts' estimates.

But the market's strength didn't last, with shares of electric power companies declining broadly after an antinuclear power candidate won the gubernatorial election in the Niigata prefecture, where Tokyo Electric Power Co., or Tepco, operates a big nuclear power plant.

Tepco shares are down 7.9%, while another regional utility, Chugoku Electric Power Co., was off 1.8% at ¥ 1,207.

Meanwhile, the Japanese yen rose Monday, gaining 0.2% against the U.S. dollar. Local exporters, however, largely shrugged off the yen's strength. Among key stocks, Toyota Motor Corp. was up 0.4%, Dai-ichi Life Holdings Inc. rose 0.7% and Panasonic Corp. added 1.8%.

Investors in Japan were also digesting comments early Monday by Bank of Japan Gov. Haruhiko Kuroda, who showed a softening in tone on further easing.

"We will continue to make necessary policy adjustments to maintain the momentum toward our price-stability target, based on economic and price conditions," Mr. Kuroda said.

These remarks contrast with Mr. Kuroda's earlier firm commitment to take additional easing, either by expanding asset purchases or lowering a subzero short-term interest rate, "without hesitation." Financial stocks were encouraged by his comments, with the Topix banking subindex recently rising 0.2%.

In Australia, declines in commodity prices offset gains from financial shares, which edged up 0.1%.

Brent crude, the global oil benchmark, was recently down 0.4% at $51.75 a barrel. Producers of the commodity felt the pinch, with Santos Ltd. down 2.7%, Oil Search Ltd. shedding 1.8% of its value and Woodside Petroleum Ltd. falling 1.6%.

Among the region's bigger stock movers, Korea's Hanjin Shipping Co. gained 5.6% on news it was seeking buyers for some of its ships in order to pay its creditors. Elsewhere, Australia's Crown Resorts Ltd. was off 8.6%, after Chinese authorities said they had detained a number of its employees on suspected gambling crimes.

On the data front, retail sales figures out of the U.S. on Friday rose 0.6% as expected, hardly moving the needle on federal-funds futures and having little impact on the probability of a Fed rate increase in Asian markets.

Within the region, market participants are watching out for third-quarter GDP data from China, due Wednesday.

Takashi Nakamichi and Kosaku Narioka contributed to this article.

Write to Ese Erheriene at ese.erheriene@wsj.com

(END) Dow Jones Newswires

October 17, 2016 00:05 ET (04:05 GMT)

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