Asia markets lower as Japan’s Nikkei slides from 4-year high; Europe stocks up in early trade

By Kelvin Chan

THE ASSOCIATED PRESS

HONG KONG — World stock markets were mixed Thursday, as investors in Japan took profits following a huge rally and China investors pulled back ahead of a weeklong holiday, while stock market rose in Europe.

The FTSE 100 index of leading British companies rose 0.1 per cent to 6,303.93 while Germany’s DAX rose 0.1 per cent to 7,5910.96. France’s CAC 40 was up 0.2 per cent at 3,650.93.

U.S stocks were poised to rise. Dow futures rose less than 0.1 per cent to 13,937 while broader S&P 500 futures gained 0.1 per cent to 1,507.70.

Asian stocks ended the day mostly lower. Japan’s Nikkei 225 fell 0.9 per cent to close at 11,357.07 as investors cashed in their gains after the benchmark rose to its highest since September 2008 in the previous session.

South Korea’s Kospi dipped 0.2 per cent to 1,931.77 while Hong Kong’s Hang Seng dropped 0.3 per cent to 23,177. Benchmarks in India, New Zealand, Singapore and Thailand also fell but Australia’s S&P/ASX 200 gained 0.3 per cent to 4,935.70.

Asia’s other big loser was the benchmark Shanghai Composite Index in mainland China, which ended 0.6 per cent lower at 2,418.53. China’s smaller Shenzhen Composite Index rose 0.5 per cent to 956.73.

Chinese investors were most likely closing out their positions ahead of the Lunar New Year holiday next week.

“The market there has had a good run and people are just being nervous about remaining invested in the market over the Chinese New Year, when the market is closed for a week and they can’t do anything,” said Andrew Sullivan, director of Asian sales trading at Kim Eng Securities.

He said that holidays in China can be an especially uncertain time for investors because authorities in Beijing often use the occasion to announce new policy measures.

“So I think people are just taking their money off the table,” said Sullivan.

Sullivan added that Japan’s currency driven market rally may be over as investors bet there’s little room for the country’s currency to weaken further. Japan’s Prime Minister Shinzo Abe has insisted that the country’s central bank act more aggressively to ease monetary policy to help spur economic growth, but Sullivan said investors are worried that “is going to have a knock-on effect to every other currency in the world.”

A weaker yen benefits Japan’s export manufacturers because it makes their products cheaper in overseas markets. Sony Corp. rose 2.6 per cent in Tokyo after it reported a smaller fourth quarter loss as sales inched up thanks mostly to the weaker yen.

Shares of News Corp. fell 3.2 per cent in Sydney after the global media conglomerate cut its forecast for annual earnings, citing underperformance at several businesses including its Fox broadcast network.

In energy markets, benchmark crude for March delivery rose 17 cents to $96.79 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 2 cents to end at $96.62 on Wednesday.

The euro rose to $1.3560 from $1.3525 in late trading Wednesday. The dollar fell to 93.18 from 93.86 yen.

05:28ET 07-02-13