By Daniel Inman
Asian markets were mostly lower Thursday as disappointing
earnings combined with steady Federal Reserve policy to bring the
region down.
The Fed met expectations by leaving its stimulus program
unchanged at its policy meeting, though it did surprise with its
upbeat assessment of the economy. This raised fears that a change
in policy could come sooner than expected, weighing on regional
sentiment.
Some investors were looking for the central bank to downgrade
its economic outlook after the government shutdown and budget
impasse earlier this month.
In fact, the government shutdown was a major focus for global
markets in the first half of October. Asian stocks proved resilient
through the drama, and most markets in the region look set to post
respectable gains for the month.
The Philippines' PSE Composite is up 6.4% for the month, while
Australia recorded a 4% gain. China has been a laggard in October,
as a rise in local interbank lending rates resulted in the Shanghai
Composite giving back some of its gains from earlier in the month
and was 1.5% lower for the month.
On Thursday, the Nikkei Average was one of the region's worst
performers, with the index down 1.2%, as a series of disappointing
earnings results helped bring down the market.
Honda Motor Co. fell 1.3% after it announced net profit for the
quarter ended September, which came in below expectations.
Battery-maker GS Yuasa Corp. sank 6.1% after posting a first-half
operating profit that was below guidance.
In Tokyo, ANA Holdings (ALNPF) declined 4.7% after the airline
lowered its 2013 fiscal-year net profit forecast by 65% on higher
fuel costs and slow service expansion because of delays in Boeing
(BA) 787 Dreamliner deliveries.
Investors were also reacting negatively to earnings from Chinese
firms in the financial sector. Hong Kong's Hang Seng Index fell
0.4%, and the Shanghai Composite lost 0.9% on the mainland.
Lenders in China were in focus after several of the country's
largest banks reported their third-quarter earnings, with profit
growth continuing to decline as the sector faced a maturing economy
and interest-rate pressure.
Bank stocks fell in Hong Kong after a sharp increase during the
previous session. Bank of Communications (601328.SH) dropped 1.1%,
while Agricultural Bank of China (ACGBF) managed a 1.1% gain.
China Minsheng Banking Corp. (CMAKY), a stock that came under
pressure during China's liquidity crisis in the summer, fell 2.4%
in Hong Kong. The country's eighth-largest lender reported its
interest income rose by just 3%.
Chinese brokerages posted strong profit growth for the nine
months that ended in September, as the industry benefited from
increased trading volumes and higher investment returns. The market
didn't welcome the news: Citic Securities was down 2.1% in
Shanghai, and Haitong Securities was 1.3% lower.
Australia's S&P/ASX 200 rose 0.2%, and South Korea's Kospi
dropped 1.4%.
National Australia Bank (NAUBF) fell 2.5% in Sydney after the
lender posted full-year earnings in line with market forecasts,
though costs were ahead of expectations.
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