Asia report: Stocks fall on back of US Fed minutes

Stocks were weaker in the Asia-Pacific region on Thursday, taking their lead from Wall Street after the minutes of the most recent Federal Reserve meeting dampened sentiment.

In Japan, the Nikkei 225 was down 0.96% at 29,942.14, as the yen weakened 0.12% against the dollar to last trade at JPY 135.21.

Tech investing giant SoftBank Group managed gains of 0.22%, while robotics specialist Fanuc was down 1.85% and Uniqlo owner Fast Retailing lost 1.7%.

The broader Topix index was 0.82% weaker by the end of trading in Tokyo, settling at 1,990.50.

On the mainland, the Shanghai Composite was off 0.46% at 3,277.54, and the technology-centric Shenzhen Component slipped 0.62% to 12,517.32.

South Korea’s Kospi lost 0.33% to 2,508.05, while the Hang Seng Index in Hong Kong slid 0.8% to 19,763.91.

Chinese technology giant Tencent Holdings was up 3.1% in the special administrative region, even after it posted its first ever fall in quarterly sales after markets closed on Tuesday.

Tencent said its bottom line was hit by a weakening economy affecting advertising sales, and playing-time regulations and a lack of game approvals from Beijing restricting new products.

The blue-chip technology stocks were mixed in Seoul, with Samsung Electronics up 1.82%, while SK Hynix was 1.44% lower.

Oil prices were higher as the region went to bed, with Brent crude futures last up 1.4% on ICE at $94.96, and West Texas Intermediate rising 1.18% on NYMEX to $89.15.

“The release of the Federal Reserve minutes was met with a collective shrug of the shoulders, as investors were deprived of any new news,” said Interactive Investor head of markets Richard Hunter.

“Indeed, the comments from those minutes have become partially irrelevant following developments since.

“In particular, a red hot jobs report and the possibility of inflation having peaked are currently on the watchlist for investors and the consensus is now that the next Fed rate hike will be one of 0.5% as opposed to the 0.75% rises previously seen.

“One element which has not changed is the Fed’s attitude to inflation, which it continues to fight against with an aggressive monetary policy, and for which it recognises the potential harm to economic growth should the screw be turned too tightly.”

In Australia, the S&P/ASX 200 was behind by 0.21% at 7,112.80, as the country’s unemployment rate fell to 3.4% in July from 3.5% in June, taking it to its lowest level since 1974.

Across the Tasman Sea, New Zealand’s S&P/NZX 50 was off 0.33% at 11,814.34, after the country’s central bank tacked on 50 basis points to interest rates on Wednesday.

The Reserve Bank of New Zealand’s governor Adrian Orr told CNBC on Thursday that he was confident inflationary pressures were receding.

“We are not saying we are out of the woods, we got still some work to do, but we have time on our side,” Orr said.

The down under dollars were both stronger on the greenback, with the Aussie last ahead 0.34% at AUD 1.4372, and the Kiwi advancing 0.09% to NZD 1.5902.

Reporting by Josh White at Sharecast.com.