Asia report: Markets down after Doha failure, Japan quakes

Markets in Asia started the week lower on Monday, with oil tumbling over the weekend and Japan traders left shaken by a series of fatal earthquakes in the country.

That country’s Nikkei 225 led the region into the red, closing down 3.4% to 16,275.95. A 7.3-magnitude tremor hit the southern island of Kyushu on Saturday - the second major tremor for the country in as many days. Major manufacturers, including Honda, Renesas Electronics, Sony and Toyota suspended production after the earthquakes.

The safe-haven yen also saw renewed strength against the US dollar, breaking through the 108 level in early trading on Monday, after hovering around the 109 level for a time late last week. It was last trading 0.35% stronger at JPY 108.38 per USD.

Exporters were sharply off, with Toyota losing 4.76%, Nissan off 2.83%, Honda down 2.92%, Sony down 6.78% and Renesas sliding 11.76%.

Markets on the mainland lagged behind Japan, with the Shanghai Composite down 1.53% at 3,034.07, and the Shenzhen Composite losing 1.3% to 1,952.41.

Metal plays in China were off, with Baoshan Steel down 1.89% and Yunnan Copper sliding 3.18%.

Renminbi was weaker against the dollar, after the People’s Bank set the yuan’s loose peg at CNY 6.4787 before markets opened. The onshore currency can float 2% either side of the peg.

Fresh data out of the country showed house prices gaining in March. The average price in 70 major cities rose 4.9% year-on-year in March, extending the 3.6% rise seen in February.

Technology hub Shenzhen was far and away the leader, where house prices surged 61.6% year-on-year. Prices in Shanghai gained 25%.

Despite the good news, property stocks were mostly lower. Poly Real Estate lost 2.32%.

In Korea, the Kospi fell 0.28% to 2,009.10, while in Hong Kong the Hang Seng Index was off 0.73% at 21,161.50.

Oil prices tumbled early during Asian trading, though did pare back some losses later in the day. Brent crude was last down 4.46% at $41.26, while West Texas Intermediate was down 4.89% at $38.48 per barrel.

The downturn in prices came after the meeting between OPEC and non-OPEC nations in Doha failed to produce a final deal to freeze output. Such an agreement was intended to boost the sustained low oil prices.

"The collapse of the oil production freeze summit has caused a wave of selling across the commodity block currencies," said OANDA senior foreign-exchange trader Stephen Innes.

Down under, the S&P/ASX 200 finished down 0.4% at 5,137.06. Resources producers were mixed, with Fortescue up 2.63%, while Rio Tinto lost 1.38% and BHP Billiton slipped 3.37%.

Energy stocks in the sunburnt country were lower, with Santos down 7.07% and Oil Search losing 4.46% as local investors digested the news from Doha.

Real estate group McGrath plunged 31.54% after a profit warning on Monday. The group posted the warning on the ASX, and said it now expected to generate FY16 revenue in the range of AUD 136m to AUD 140m.

New Zealand shares bucked the trend, but barely treaded water, with the S&P/NZX 50 gaining 0.1% on Monday to 6,851.20. It was led by international casino operator SkyCity Entertainment, which rose 2%.

The Aussie moved away from its American counterpart on Monday, and was last 0.39% weaker at AUD 1.2996, while the Kiwi edged closer to the greenback and was last 0.21% stronger at NZD 1.4418.