China attempts to reassure investors as stocks continue to slide

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Asia Stock

Friday, August 3,2018

Asian stock indexes were mixed in early trading Friday, with some markets helped by solid gains on Wall Street while others continued to struggle amid fresh U.S.-China trade worries.

Japan’s Nikkei NIK, +0.06%   was up 0.4%, with the yen having eased a bit the over past day. Japanese stocks continued to get support from the electronics sector following strong first-quarter earnings reports earlier this week. Chip maker Rohm 6963, +1.28%   was up 1.8% while Panasonic 6752, +2.23%   gained 2.7% and Sony 6758, -0.10%   rose a further 0.5%. The steel and shipping sectors were both down 1.6% amid persistent concerns about trade conflicts. Elsewhere, tractor maker Kubota 6326, -8.29%   slid 9.2% following weak quarterly results and a forecast cut for the year on a decrease in agriculture-machinery sales in China.

Chinese stock indexes turned lower after starting the day with gains following Thursday’s 2%-plus slide. The Shanghai Composite SHCOMP, -1.00%   was last down 0.3% and the Shenzhen Composite 399106, -1.72%   was off 0.9%, after hitting a 3½-year closing low the day before.

China’s stock slide seems have prompted officials to try and talk up the market. The Securities Daily, widely regarded as speaking on behalf of the country’s securities regulator, on Friday published what can be described as a “pep talk” article similar to what was printed Thursday by the People’s Daily, the Communist Party’s mouthpiece. The Securities Daily attributed stock declines to liquidity tightening and trade tensions and said the market’s weakness “isn’t justified” given undemanding valuation, solid fundamentals and increasing proactive policies. Despite saying the Shanghai Composite could breach early 2016’s low of 2,638, the Securities Daily says it expects a zig-zag uptrend to emerge, based on cycle analysis, by the end of August.

Hong Kong stocks gave up early gains after a day after the Hang Seng Index closed at its lowest level since late September. The Hang Seng HSI, -0.14%   was last down 0.3%, on pace for its worst week in six months. Insurer AIA 1299, +0.46%   rebounded more than 0.6% while auto maker Brilliance China 1114, -1.32%   tumbled some 2.5% after second-quarter results from partner BMW BMW, +1.36%  . Index heavyweight HSBC 0005, -0.69%   was down 0.7%.

Benchmarks in Australia XJO, -0.10%   and South Korea SEU, +0.77%   were 0.2% higher and New Zealand’s NZX 50 NZ50GR, +0.17%   has risen nearly as much at midday there. Australian fintech company Axsesstoday AXL, +2.05%   fell into the red after shooting up 2% earlier in the session after raising its yearly profit-growth guidance. Its shares have jumped 66% this year.

Singapore’s stock index STI, -0.55%   advanced 0.6% early on, but was last down 0.2%. Its bank sector was hit Thursday after DBS’s earnings report, and DBS D05, -1.36%  sank an additional 1.5% Friday, while rival bank OCBC O39, +0.09%   was 1% higher. Bloomberg

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