Asia report: Markets finish higher despite Brexit uncertainty

Most markets in Asia finished Tuesday higher, managing to stabilise somewhat amid a Brexit-based global retreat.

In Japan, the Nikkei 225 closed up 0.09% at 15,323.14, after hovering above and below the line for much of the session.

The yen managed to keep its strength against the dollar, putting equities in the country under pressure - it was last 0.15% weaker at JPY 102.15.

Major carmakers sold off, with Honda off 1%, Nissan losing 1.14% and Toyota dropping 3.42%.

Embattled airbag manufacturer Takata saw its shares close up 2.18%, reversing earlier losses after reports that a Takata airbag inflator had ruptured in a fatal crash in Malaysia.

Takata CEO Shigehisa Takada said on Tuesday that he would resign after the implementation of a “new regime”.

On the mainland, the Shanghai Composite Index was up 0.59% at 2,912.75, while the Shenzhen Composite gained 1.21% to 1,970.37.

Renminbi was fixed at CNY 6.6528 per USD before the market open - the People’s Bank of China allows the onshore yuan to trade 2% above or below the loose peg.

Korea’s Kospi added 0.49% to 1,936.22, reversing losses of almost 0.5% earlier in the session, while Hong Kong’s Hang Seng Index dropped 0.27% to 20,172.46, having been sitting gains of more than 0.5% during afternoon trading.

Oil prices were ahead during Asian trading, with Brent crude last up 1.7% at $47.97 per barrel and West Texas Intermediate adding 1.86% at $47.21.

The world’s focus was still very much on the unknowns of Brexit, with ratings agency Standard & Poor’s cutting its credit rating for the UK by two notches, from AAA to AA, and Fitch lowering its rating from AA+ to AA.

Australia’s S&P/ASX 200 lost out, dropping 0.66% to 5,103.30, dragged down 0.11% by its weighty financials subindex.

Some major banking stocks reversed their Brexit losses, however, with Australia and New Zealand Banking Group adding 0.1% and National Australia Bank ahead by 0.49%.

Analysts had predicted the Australasian banks would receive a hammering-by-association as British and European banking stocks fell through the floor on Monday.

“UK and European banks are getting destroyed, having the worst two-day move ever,” said IG chief market strategist Chris Weston.

“The UK referendum has not just left a stain on British politics (and society), but it has unmasked a number of macro concerns that were largely smoothed over in the wake of the coordinated central action in February.”

Across the Tasman Sea, New Zealand’s benchmark S&P/NZX 50 rose 0.4% to 6,718.58 as investors clamoured for the relative insulation of domestic-focused stocks.

The down under dollars were strengthening against the greenback, having weakened markedly on Monday - the Aussie was last ahead by 0.91% at AUD 1.3517 and the Kiwi gained 1.03% on the dollar to NZD 1.4148.