Asia report: Stocks mixed on wave of corporate earnings

Markets in the Asia-Pacific region experienced a mixed performance on Wednesday, as investors weighed corporate earnings reports and policy developments out of China.

Patrick Munnelly, market analyst at TickMill, said Asian stocks were mostly positive due to a decline in global yields and further Chinese support efforts.

“[The] Nikkei 225 was indecisive due to a slew of earnings and with the Bank of Kapan reportedly on track for a policy shift by April.

“The Hang Seng and Shanghai Composite were mixed despite early momentum following the latest support efforts from China, targeting real estate financing and new energy vehicles.

“Chinese stocks gradually faded some of their initial gains, and the Hong Kong benchmark ultimately turned negative.”

Markets mixed on slew of corporate earnings reports

In Japan, the Nikkei 225 index dipped slightly by 0.11% to 36,119.92, while the broader Topix index edged up by 0.42% to 2,549.95.

The biggest decliners on Tokyo’s benchmark included LY Corporation, down 7.22%; Daikin Industries, off 7.07%; and Asahi Kasei, which lost 6.57%.

On the other hand, mainland Chinese stocks saw gains, with the Shanghai Composite rising 1.44% to 2,829.70 and the Shenzhen Component jumping 2.93% to 8,708.24.

Leading the risers in Shanghai was China Southern Power Grid Energy Storage, up 10.05%, followed by Bluestar Adisseo, which advanced 10.01%.

In Hong Kong, the Hang Seng Index slipped by 0.34% to 16,081.89, with declines led by SMIC, off 7.95%, China Overseas, down 5.89%, and Lenovo Group, which was 4.25% weaker.

SMIC, China's largest chipmaker, cited global macroeconomic headwinds and geopolitical tensions as potential impacts on its 2024 business outlook after reporting a significant drop in fourth-quarter profit on Tuesday.

Chinese electric vehicle makers were also in focus in the special administrative region, after the Ministry of Commerce in Beijing announced plans for the “healthy development of new energy vehicles”.

The ministry said the plans would “help promote the transformation and upgrading of the automobile industry, and play an important supporting role in stabilising and optimising the structure of foreign trade,” according to CNBC.

Shares in BYD were up 1.05% by the end of trading in Hong Kong, and Nio advanced 1.79%.

South Korea's Kospi increased 1.3% to 2,609.58, with Pan Ocean surging 21.09% and Sebang Global Battery leaping 17.42%.

KakaoBank was also in the green, rising 4.03% after the company reported a near-25% improvement in fourth quarter profit and a 37% jump in operating revenue.

In Australia, the S&P/ASX 200 index rose modestly by 0.45% to 7,615.80.

GQG Partners rose 7.38% and Alumina added 5.69% to lead the gainers in Sydney, while Santos was 5.84% weaker after merger talks with Woodside ended without an agreement.

The S&P/NZX 50 index in New Zealand saw a slight uptick of 0.2% to 11,952.17, with Pacific Edge ahead 6.32%, and A2 Milk Company rising 3.75%.

In currency markets, the dollar was last 0.04% stronger on the yen, trading at JPY 148.00, while it remained steady against the Aussie at AUD 1.5329, and weakened 0.08% against the Kiwi to change hands at NZD 1.6387.

In commodity markets, both Brent crude and West Texas Intermediate futures edged higher, with Brent crude up 0.81% on ICE to $79.23 per barrel, and the NYMEX quote for WTI rising 0.86% to $73.94.

Unemployment rate comes in lower than expected in NZ

In economic news, there was a positive surprise out of New Zealand as the fourth-quarter unemployment rate came in at 4%, surpassing economists' expectations.

Economists polled by Reuters had anticipated a slightly higher rate of 4.2%.

Despite that, the latest figure still represented a slight increase from the prior quarter's rate of 3.9%, and a notable rise from the 3.4% recorded in the same quarter of 2022.

While the unemployment rate edged up, the country's participation rate saw a marginal decline.

In the fourth quarter, the participation rate stood at 71.9%, slightly lower than the 72% seen in the third quarter.

Reporting by Josh White for Sharecast.com.