Asia: Nikkei declines as car stocks slump hits Japan
Asian equity markets struggled for direction on Thursday, as Japanese stocks fell amid mixed economic reports.
Trading in Japan resumed after a three-day holiday but the Nikkei Stock Average fell 2.76%, dragged lower by a sharp decline in auto-parts makers, which mirrored the drop suffered by their European counterparts earlier this week.
Mazda Motor lost 6.80%, Mitsubishi Motors fell 2.8%, while diesel particulate filter maker NGK Insulator fell 6.97%.
“Japanese equities appear to be playing catch up with the rest of the region after markets opened for the first trading session this week,” said analysts at Deutsche Bank.
In macroeconomic news, the Markit/Nikkei Japan Flash Manufacturing Purchasing Managers Index (PMI) declined from 51.7 in August to 50.9 in September, slightly below consensus for a 51.2 reading and above the 50 threshold that indicates expansion for the fifth consecutive month.
However, it was the first time in the three months the index had declined.
The sub-index tracking new export orders fell into contraction territory after sliding from 51.6 to 47.8, the biggest decline since February 2013.
Meanwhile, according to the country’s Ministry of Economy, Trade and Industry, the all industry activity rose a seasonally adjusted 0.2% month-on-month in July compared with an upwardly revised 0.5% growth the previous month.
Economists had expected the index to remain flat during the period.
After a dismal PMI reading on Wednesday, Chinese markets enjoyed mixed fortunes on Thursday, with the Shanghai Composite Index climbing 0.86%, while Hong Kong’s Hang Seng declined 0.97%.
“The soft China flash PMI will add to the batch of data releases from China which continue to weigh on investor concerns about the developments within its economy, with the likelihood of the PBoC continuing its easing cycle as a tool to promote economic stability,” said FXTM research analyst Lukman Otunuga.
Elsewhere, South Korea’s Kospi edged 0.13% higher, while Australia’s S&P/ASX 200 marked the Wallabies’ winning debut at the Rugby World Cup by closing up 1.47%.
On the currency front, the Taiwan dollar lost 0.657% against its US counterpart, reaching a new-six year low against the greenback shortly after Taiwan’s central bank cut its benchmark interest rates for the first time in over six-and-a-half years.
Asian investors will now turn their attention across the Pacific, with Fed chairwoman Janet Yellen speaking at 2200 BST on Thursday in what will be her first speech since the US central bank opted against hiking interest rates last week.