Asia report: Most markets higher after bumper US session

Most markets in Asia finished green on Wednesday, following a bumper Tuesday session on Wall Street overnight, with investors still looking for direction from the Trump administration on banking deregulation and tax reform.

In Japan, the Nikkei 225 was virtually flat, closing down 0.01% at 19,379.87, with Toshiba stock making unexpected gains.

The technology firm’s shares were up 22.32% after reports emerged locally that the beleaguered conglomerate was asking potential bidders for its valuable memory chip division to see its value at a minimum of JPY 2trn.

Rakuten was another big gainer in the land of the rising sun, adding 9.39% after the announcement of a share buyback programme on Tuesday.

The online retail giant said it would purchase 8.4% of the total shares outstanding, excluding treasury shares, for a maximum value of JPY 100bn.

On the currency front, the yen was relatively weaker on Wednesday, but it gained some strength in late trading and was last ahead 0.53% at JPY 113.08 per $1.

That weaker yen boosted the major exporters, with Canon up 1.04%, Sony adding 0.4% and Toyota 0.39% firmer.

On the mainland, the Shanghai Composite closed 0.23% higher at 3,260.93, while the smaller, technology-oriented Shenzhen Composite added 0.46% to 1,990.33.

In South Korea, the Kospi was up 0.17% at 2,106.61, while Hong Kong’s Hang Seng Index was 0.99% firmer at 24,201.96.

Asia’s green session came off the back of a positive Tuesday stateside, as traders returned from the Presidents’ Day holiday on Monday.

“US stock markets are currently a great example of the old trading adage that the trend is your friend,” noted CMC Markets chief market analyst Ric Spooner.

Oil prices were higher during Asian hours, before slipping again during early European trading, with Brent crude last down 0.35% at $56.46 and West Texas Intermediate losing 0.43% to $54.10 per barrel.

Australia’s S&P/ASX 200 started the day lower, but finished in the green by 0.24% at 5,805.09.

Health supplement manufacturer Blackmores had a vitamin-deficient session, however, losing 10.34% after it reported a 41% drop in half-year profits to AUD 28.5m.

Analysts polled by Reuters had expected the regional segment leader to turn a profit of AUD 75.8m for the period.

Major miner BHP Billiton was off 0.67% after it missed forecasts for its first half on Tuesday.

The London and Sydney-listed firm did post a near-800% improvement in net profit for the period to $3.24bn, but the markets had been expecting a figure of around $3.4bn.

On the economic front, Governor of the Reserve Bank of Australia Philip Lowe told an event that further cuts to the country’s official cash rate would not be beneficial to the domestic economy, as it could lead to a rise in household debt.

“Then at some point in the future, households having decided that they had borrowed too much, might cut back consumption sharply, hurting the overall economy and employment,” he explained.

In New Zealand, the S&P/NZX 50 was down 0.7% at 7,062.47 as the week of telecoms shake-ups continued in the land of the long white cloud.

Subscription broadcaster Sky - unrelated to its London-listed namesake -was down 2.7% after it reported a 32% drop in first half profit, while broadband and mobile operator Spark was up 0.6%.

The country’s Commerce Commission regulator was due to release its decision on a proposed merger between Sky and Vodafone’s New Zealand operations on Thursday.

Vodafone and Sky had indicated they would move forward with the merger immediately, ignoring usual convention to allow competitors and other stakeholders a chance to review the decision and consider further legal action.

However, the pair were ordered to wait at least 36 hours after the decision on Wednesday, after a case was brought to the High Court by Spark asking for such a holding period so it could consider an appeal if the merger is approved.

The down under dollars were both marginally stronger, with the Aussie last 0.06% ahead on the greenback at AUD 1.3021, and the Kiwi advancing 0.01% to NZD 1.3962 per $1.