By Michael Kitchen, MarketWatch
LOS ANGELES (MarketWatch) -- Asia markets traded lower
Wednesday, with investors slapping down Japanese stocks after the
yen spiked overnight.
Japan's Nikkei Stock Average had thudded 1.8% lower by the end
of the morning session, but it held on to the 13,000 level, trading
at 13,072.61.
Other major indexes fell more modestly, with Australia's
S&P/ASX 200 down 0.9%, and South Korea's Kospi losing 0.3%,
while Singapore's Straits Times Index and New Zealand's NZSX 50
each lost 0.3%.
Markets in China -- including those in Hong Kong and Shanghai --
were closed for the Dragon Boat Festival.
Japan led the losses after the dollar (USDJPY) fell by almost 2
full yen overnight, with the greenback sitting at Yen96.48 midday
in Tokyo after buying more than Yen98 at Tuesday's Japan stock
close.
The dollar traded above Yen100 early last week but hasn't moved
above that level since Japanese Prime Minister Shinzo Abe announced
a slate of economic reforms -- referred to as the "third arrow" of
his three-pronged push to revive the nation's fortunes, along with
fiscal stimulus and monetary easing.
Chapdelaine FX managing director Douglas Borthwick compared
Abe's campaign unfavorably with European Central Bank President
Mario Draghi's actions to combat the euro-zone debt crisis.
"The ECB carries a bazooka into the currency wars, as Draghi
pledges to do 'whatever it takes,' [while] Japan's Prime Minister
Abe is fighting with a bow and arrow," he wrote Tuesday. "The
market is taking the view that Japan may not have either the
stomach or the capacity to follow through with Prime Minister
Abe."
The yen's moves Tuesday prompted further misery for Japanese
exporter shares Wednesday, with Sony Corp. (SNE) down 3%, Renesas
Electronics Corp. (RNECY) losing 4.3%, Toyota Motor Corp. (TM) and
Nissan Motor Co. (NSANY) each down 3.2%.
Hitachi Ltd. (HIT) managed brief morning gains after a Nikkei
news report that the conglomerate had secured an order to supply
trains for a light-rail project in Vietnam's Ho Chi Minh City, but
the shares ended the morning down 0.2%.
Among the few advancers, Panasonic Corp. (PC) added 0.7% after a
separate Nikkei report that China's Huawei Technologies Co. would
double by value its procurement of parts from Japan over the next
several years, with Panasonic as one of the beneficiaries.
Meanwhile, Tuesday's losses on Wall Street -- with a
triple-digit loss for the Dow industrials (DJI) and a 1% fall for
the S&P 500 (SPX) -- helped weigh on financials around
Asia.
In Tokyo, Mitsubishi UFJ Financial Group Inc. (MTU) lost 3.6%,
Dai-ichi Life Insurance Co. (DCNSF) traded 4.6% lower, Daiwa
Securities Group Inc. (DSEEY) dove 4.2%, and Resona Holdings Inc.
(8308.TO) pulled back 4.5%.
Likewise, many Australian banks saw selling, with National
Australia Bank Ltd. (NAUBF) down 1.1%, Westpac Banking Corp. (WBK)
off 1.7%, and Australia & New Zealand Banking Group (ANEWF)
losing 1.2%.
Mining stocks also took a toll on the Sydney market after a
decline in many commodity prices, with Fortescue Metals Group Ltd.
(FSUMY) down 1.8%, BHP Billiton Ltd. (BHP) slipping 0.8%, and
Newcrest Mining Ltd. (NCMGF) off 1.3% after the gold producer told
Australia's securities exchange that it didn't break any
share-listing rules related to the timing of the company's recent
restructuring announcement.
Early weakness in Australia briefly sent the S&P/ASX 200
into a technical correction, defined as a 10% drop from the most
recent high.
In South Korea, Samsung Electronics Co. (SSNLF) pared its
early-morning losses to trade down 0.1% in the midday. The shares
dropped 2.5% Tuesday amid concerns over sales for its new Galaxy S4
smartphone.
Credit Suisse said it held the shares' rating at outperform, and
that the recent losses for Samsung offered a buying opportunity,
according to Dow Jones Newswires.
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