Asia report: Markets end up red as they price in Trump prospects

Markets in Asia finished lower on Friday, with Japan and Australia leading the losses as investors followed the lead of their US counterparts and rushed to safe havens as presidential election fears heightened.

In Japan, the Nikkei 225 closed down 1.34% at 16,905.36, while the broader Topix finished 1.56% lower at 1,347.04, with a stronger yen weighing on the domestic markets.

Investors were clamoring for the safe haven yen, which was stronger against the greenback for much of the session.

It was last 0.03% weaker, however, at JPY 103.01 per $1, losing some of its puff as the region entered the weekend.

That stronger currency forced down the stocks of Japan’s major exporters, with Mazda Motor off 5.08%, Sony down 2.76% and Toyota losing 4.04%.

Shares in embattled airbag maker Takata closed down 1.75%, after the Nikkei reported it was preparing to file for bankruptcy protection in the US as costs over its massive recall continued to build.

Takata issued a statement later in the day, saying it had nothing to announce in response to the media speculation.

It did raise its full-year forecast, however, for a profit of JPY 20bn in the 12 months to March, up from a previously forecast JPY 13bn and last year’s net loss of JPY 13.1bn.

The forecast came with a caveat, however, as it did not include the cost of recalling the company’s fatally faulty airbags.

On the mainland, the Shanghai Composite was down 0.12% at 3,125.07, while the Shenzhen Composite was off 0.21% at 2,067.15.

In Korea, the Kospi was off 0.09% at 1,982.02, while Hong Kong’s Hang Seng Index lost 0.18% to 22,642.62.

“Markets are currently attempting to strike the right balance between the greater probability of a Clinton win and the possibility of a significant sell-off on a Trump victory,” noted CMC Markets chief market analyst Ric Spooner.

Oil prices were higher during Asian trading, though they began to slip as the region’s traders clocked off for Friday night drinks.

Brent crude was last down 0.37% at $46.18 per barrel and West Texas Intermediate lost 0.11% to $44.61.

In Australia, the S&P/ASX 200 finished down 0.86% at 5,180.80, marking its fifth session of losses in a row and ending at the lowest level in more than four months.

The benchmark was dragged down by the hefty financials subindex, which lost 1.6%, while the energy sector fell 0.9%.

All of the big four regional banks finished lower, with National Australia Bank leading the pack as it slipped 5.99% after going ex-dividend.

It had announced a dividend of 99 Australian cents per share last week.

Of the other major banks, Australia and New Zealand Banking Group was down 1.5%, Commonwealth Bank of Australia lost 0.87% and Westpac finished 0.54% softer.

Explosives and industrial chemicals maker Orica soared 8.33% in Sydney, after the firm reported an annual net profit before one-off charges of AUD 389m - a 7% reduction on the prior year.

New Zealand’s benchmark S&P/NZX 50 slipped 1% to a four month low of 6,708.47, led lower by e-commerce platform Trademe and construction giant Fletcher Building, down 3% and 2.8% respectively.

There was a silver lining in the land of the long white cloud on Friday, however, as the island nation in the Pacific was ranked top of the 149-nation Legatum Prosperity Index, ahead of Norway, Finland and Switzerland.

“That [New Zealand] can generate the world's highest level of prosperity with only average wealth for a developed country, is an achievement based on strong structural foundations and ongoing improvements in key areas of prosperity,” the report said.

New Zealand has topped the index since 2013.

The down under dollars weren’t looking quite as prosperous, with the Kiwi lat 0.29% weaker against the greenback at NZD 1.3666, and the Aussie retreating 0.03% to AUD 1.3021 per $1.