Chinese and Hong Kong stock markets advanced for the first time in three sessions a day after the People’s Bank of China further increased banks’ reserve requirements, while Indian shares were boosted by early results of some state elections.
In Japan, the Nikkei 225 average surrendered 67.88 points, or 0.7%, to 9,648.77
Hong Kong’s Hang Seng Index, on the other hand, spiked 202.51 points, or 0.9%, to 23,276.30.
Stocks in Tokyo dropped as banks were hit by speculation they may have to waive some loans to Tokyo Electric Power Co., while shares in Seoul declined after the Bank of Korea belied market expectations for an interest rate increase.
Hong Kong and Chinese shares overcame volatile early trading to finish higher, as investors shrugged off the PBOC’s decision to raise lenders’ reserve requirements as part of efforts to drain excess liquidity in the market. The move is the PBOC’s fifth such hike this year.
In Japan, banks were pressured on speculation of a loan-waiver for Tepco. The decline came after Chief Cabinet Secretary Yukio Edano said at a press conference the public will never accept the use of tax money to help the utility pay compensation for damage stemming from the accident at its Fukushima Daiichi nuclear-power plant, unless banks waive their Tepco debts from before the March 11 earthquake.
Sumitomo Mitsui Financial Group Inc. gave up 3.8%, Mizuho Financial Group Inc. lost 3% and Mitsubishi UFJ Financial Group Inc. shed 2.8%.
Tepco tumbled 5.4% even after the government announced a plan to rescue the company and fund compensation claims following the country’s worst-ever nuclear-energy disaster.
Lending some support to the market, shares of Nissan Motor Co. rose 3.5% after a solid fourth-quarter earnings report, and on bullish comments from Chief Executive Officer Carlos Ghosn.
In Seoul, the Kospi extended its morning losses even after the Bank of Korea surprised markets by leaving interest rates unchanged at 3%. Most economists had predicted a 0.25-percentage-point rate increase.
Financial stocks, which benefit from rate hikes on expectations for better margins, lost ground after the decision, with Shinhan Financial Group Co. dropping 3.3% and Woori Finance Holdings Co. shedding 1.4%.
Hana Financial Group Inc. plunged 14.9% on worries the lender’s proposed 4.69 trillion won ($4.32 billion U.S.) offer for Lone Star Funds’ 51% stake in Korea Exchange Bank may be on the verge of collapse.
In foreign-exchange markets, the yen was higher against both the U.S. dollar and the euro as a decline in the Nikkei encouraged some investors to buy the safe-haven Japanese currency.
The U.S. dollar was at 80.53 yen, compared with ¥80.94 late Thursday in New York. The euro was buying ¥115.24 from ¥115.32, and $1.4304 U.S. from $1.42 U.S.
CHINA
In particular, Chinese banks and property stocks advanced in apparent relief in Friday’s trading.
Shanghai’s CSI 300 Composite Index gained 26.49 points, or 0.9%, to 3,128.09
Agricultural Bank of China Ltd. and China Construction Bank Corp. rose 0.7% and 1% in Shanghai, respectively; in Hong Kong, the stocks rose 0.7% and 0.8%.
Among developers, Poly Real Estate Group Co. added 1.9% in Shanghai, while China Resources Land Ltd. rose 0.5% in Hong Kong.
In other markets;
Taiwan’s Taiex Index docked 27.07 points, or 0.3%, to 9,006.61
Korea’s Kospi index sifted off 2.57 points, or 0.1%, to 2,120.08
Singapore’s Straits Times index added 33.23 points, or 1.1%, to 3,163.68
New Zealand’s NZX 50 fell 4.53 points, or 0.1%, to 3,535.79
Australia’s S&P/ASX 200 moved higher by 15.30 points, or 0.3%, to 4,711.40
