Asia report: Most markets weaker, HSBC jumps on earnings

Most markets in Asia finished weaker on Tuesday, as the Bank of Japan sated market expectations by keeping its monetary policy on hold.

In Japan, the Nikkei 225 was down 0.46% at 28,991.89, as the yen weakened 0.25% against the dollar to last trade at JPY 108.35.

Uniqlo owner Fast Retailing was up 1.27%, while among the benchmark’s other major components, robotics specialist Fanuc was down 1.42% and technology giant SoftBank Group was off 0.94%.

The broader Topix index lost 0.76% by the end of trading in Tokyo, to settle at 1,903.55.

Japan’s monetary policy was to be held steady, the country’s central bank confirmed earlier in the day, although it did revise its forecast for inflation downwards.

The Bank of Japan now expects core inflation to be 0.1% in the 2021 financial year, compared to its forecast for 0.5% in January.

That move came after a number of populous regions were placed under new Covid-19 containment measures, including Osaka and Tokyo, in a bid to stem fresh outbreaks of the coronavirus.

On the mainland, the Shanghai Composite eked out gains of 0.04% to 3,442.61, and the smaller, technology-centric Shenzhen Composite squeezed ahead 0.03% to 2,281.93.

South Korea’s Kospi slipped 0.07% to 3,215.42, while the Hang Seng Index in Hong Kong was 0.04% weaker at 28,941.54.

Banking giant HSBC rose 2% by the close in the special administrative region, after it reported a 79% jump in pre-tax profits for the first quarter, beating market expectations.

Technology conglomerate Meituan, meanwhile, wass up 2.62%, even after the State Administration for Market Regulation in Beijing said the firm was its next target in its investigations into anticompetitive practices in the sector.

“[We will] actively cooperate with the SAMR’s investigation and strictly implement relevant requirements,” the company said in its statement, adding that its business operations were continuing as usual.

Seoul’s blue-chip technology stocks were mixed, with Samsung Electronics down 0.72%, while SK Hynix jumped 2.66%.

Market attention globally was turning stateside as the week progressed, with investors starting to close their wallets ahead of the April Fed meeting.

“Investors are likely to stand on the sidelines ahead of the FOMC meeting and the upcoming peak of the US earnings season, so the consolidation is set to continue in the next 24 hours,” said Axi market analyst Milan Cutkovic.

“Strong earnings numbers are keeping Wall Street´s bullish mood intact - the upcoming figures from Alphabet, Amazon and Apple are likely to exceed expectations.”

Cutkovic said the dollar remained weak, and was likely to come under renewed pressure after the FOMC meeting on Wednesday.

“The Fed is expected to reiterate its dovish stance and play down inflation risks.”

Oil prices were higher as the region went to bed, with Brent crude last up 0.98% at $66.29 per barrel, and West Texas Intermediate rising 1.1% to $62.59.

In Australia, the S&P/ASX 200 was down 0.17% at 7,033.80, while across the Tasman Sea, New Zealand’s S&P/NZX 50 returned from a long weekend to lose 0.24%, closing at 12,620.52.

The down under dollars were both weaker against the greenback, with the Aussie last off 0.32% at AUD 1.2862, and the Kiwi retreating 0.4% to NZD 1.3875.