By V. Phani Kumar, MarketWatch
HONG KONG (MarketWatch) -- Most Asian markets fluctuated between
modest gains and losses in choppy trading Monday, with worries
about the Federal Reserve's policy outlook and rising U.S Treasury
yields weighing on sentiment.
Japan's Nikkei Stock Average ending the morning session 0.1%
higher, and Australia's S&P/ASX 200 also advanced 0.1%, after a
string of recent losses. Both benchmarks changed direction a few
times during the day.
Hong Kong's Hang Seng Index was little changed and the Shanghai
Composite lost 0.3%, after also seesawing between positive and
negative territory.
Elsewhere, South Korea's fell 0.2%, and Taiwan's Taiex shed
0.3%.
"Recent weakness in U.S. equity markets appears to have been
largely about positioning for the Fed to make a first step in the
process of winding back its quantitative easing in September," said
CMC Markets chief market analyst Ric Spooner.
The performance in Asia came after U.S. stocks ended lower on
Friday, handing the Dow Jones Industrial Average its worst weekly
performance of the year. Meanwhile, the yield on the 10-year
Treasury rose to hit the highest level in two years amid jitters
over monetary policy.
"Given this market context, traders will focus on ... [Federal
Reserve meeting minutes, due out Wednesday] for any clearer signs
on the probability of a Fed move," Spooner said.
Hong Kong property developers suffered from the weak U.S. cues,
with Sun Hung Kai Properties Ltd. (SUHJF) losing 0.7%, and Sino
Land Co. (SNLAY) giving up 0.5%.
Mainland Chinese developers also weakened despite data showing a
further improvement in Chinese home prices last month. Prices of
new homes rose in 62 of 70 large and medium-sized Chinese cities in
July from their levels in June, data from the National Bureau of
Statistics showed Sunday.
Gemdale Corp. lost 3.2% in Shanghai, while the yuan-denominated
shares of China Vanke Co. eased 0.7% in Shenzhen, and China
Overseas Land & Investment Ltd. (CAOVY) shed 0.6% in Hong
Kong.
The choppy trade in Shanghai followed extreme volatility
witnessed Friday after a large unintended trade was executed at a
mid-sized trading firm, Everbright Securities Co. The China
Securities Regulatory Commission said in a statement Sunday the
trading glitch was caused by design defects and the transaction
system at Everbright, rather than by human error.
Shares of Everbright remained under a trading halt Monday,
following news the mid-sized brokerage firm lost 194 million yuan
($31.7 million) from that trading glitch.
In Tokyo, steel makers and some automobile firms dropped even as
the yen briefly weakened after data showing the country's trade
deficit widened sharply in July from the year-ago period.
Suzuki Motor Corp. (SZKMY) dropped 1.2%, and JFE Holdings Inc.
(5411.TO) retreated 1.4%.
However, shares of Kawasaki Heavy Industries Ltd. (KWHIY) rose
1.1% after the Nikkei newspaper reported the company will team up
with Rolls-Royce Holdings PLC (RYCEY) to develop a new aircraft
engine that is more fuel-efficient.
The market in Sydney suffered a drag from shares of Commonwealth
Bank of Australia (CBAUY), which dropped 2.8%, and
telecommunications major Telstra Corp. (TLSYY), which declined
3.4%, as both stocks traded without rights to a dividend.
BlueScope Steel Ltd. (BLSFY) sank 15.5% after it said it doesn't
expect a better outcome for the first half of 2014 than it had in
the second-half of 2013. BlueScope's annual loss narrowed to 84.1
million Australian dollars (AUDUSD) ($77.3 million).
On the upside in Asia, however, energy producers gained after
oil prices rose Friday in the U.S.
In Tokyo, Japan Petroleum Exploration Corp. climbed 1.1%, and
Inpex Corp. (IPXHF) added 0.8%.
Likewise, Woodside Petroleum Ltd. (WOPEY) gained 1.5% in Sydney,
and Cnooc Ltd. (CEO) rose 1.2% in Hong Kong.
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