Shanghai shares were hammered for the second straight session Monday on persistent worries about a slowing economy and after data showed the country's wholesale inflation soared to a decade high in June.
The benchmark Nikkei 225 index closed up 262.50 points or 1.99% at 13,430.91 while the benchmark Hang Seng Index lost 25.87 points or 0.12% to settle at 21,859.34, off the day's high of 22,235.51.
On the economic front, a preliminary report from the Japan Machine Tool Builders Association showed that machine tool orders declined 8.9% on year-over-year basis to 123.81 billion yen in July. On a monthly basis, total orders fell 3.6%. Machine tool orders from foreign countries fell 7.9% to 71.10 billion yen, while domestic orders decreased 10.3% to 52.71 billion yen.
Export-oriented auto and high-tech stocks rose after the dollar hit a seven-month high at the lower 110-yen level on Monday. Toyota Motor jumped 4.1%, Canon gained 3.7%, Honda Motor surged 4.6% and Sony advanced 2.8%.
Among banks, Mitsubishi UFJ Financial Group rose 3.7%, Mizuho Financial Group gained 2.1% and Sumitomo Mitsui Financial Group added 1.4%. In the property sector, Mitsubishi Estate advanced 2.4%, Mitsui Fudosan climbed 2.1% and Sumitomo Realty & Development moved up 3.6%.
Tech gainers included Advantest 4.0%, Tokyo Electron 3.9%, NEC 2.6%, Kyocera 1.9%, Fanuc and Fujitsu 3.2% each, Matsushita Electric Industrial 3.1% and Oki Electric Industry 1.8%.
However, commodity-related stocks closed mostly lower. Oil and gas miner Inpex Holdings slipped 0.1%, Nippon Oil lost 1.2%, Itochu plunged 4.1%, Mitsubishi Corp fell 1.8%, Mitsui & Co dropped 1.9% and Nippon Mining Holdings added 0.8%.
The Chinese market closed sharply lower, extending Friday's losses, amid panic selling following a stronger-than-expected producer price index reading. Airlines and nonferrous stocks led the declines. The benchmark Shanghai Composite Index slumped 135.65 points or 5.21% to finish at 2,470.07, the lowest closing level in 19 months, after falling 4.5% on Friday.
Government data released today showed that PPI rose 10.0% in July from a year earlier, the fastest rate of growth since 1996. The PPI reading points to strong wholesale prices that are expected to flow on to consumer prices later.
Meanwhile, the Chinese trade surplus increased to US$25.28 billion in July from US$21.4 billion recorded in June, according to the General Administration of Customs. Economists were looking for a surplus of US$20.35 billion. Exports registered an annual growth of 26.9%, while imports surged 33.7%. During January to July, the surplus totaled US$123.7 billion, down US$13.1 billion from the prior year.
Among airlines, China Eastern Airlines fell 10% after the company said that it will continue to seek strategic investors despite the expiry of its stake sale agreement with Singapore Airlines. China Southern Airlines and Air China also fell 10%. The three major Chinese carriers all tumbled by the 10% daily limit on Friday also.
In the oil space, China Petroleum & Chemical or Sinopec plunged 5.4% and index heavyweight PetroChina plummeted 5.5%.
Elsewhere:
Taiwan's Taiex closed up 1.6% at 7,325.
Singapore's STI closed up 0.6% at 2,825.
Malaysia's KLCI closed up 0.6% at 1,127.
Indonesia's Jakarta Composite index closed down 2.8% at 2,133.
India's Sensex closed up 2.2% at 15,503.
Australia's S&P/ASX 200 added 0.8% to 5,026.10.
South Korea's Kospi climbed 1.2% to 1,587.28.
New Zealand's NZX 50 index added 0.4%.
with files from other wire services
