CANBERA (dpa-AFX) - Asian stock markets are trading notably lower on Thursday with investors indulging in some heavy selling amid worries about a possible downgrade of U.S. treasury debt following the continued delay in deciding on raising the debt limit.
Mirroring widespread selling, all the sectoral indices are down in negative territory in the Australian market. Energy, mining, financial and industrial stocks are mostly trading weak.
The benchmark S&P/ASX 200 index is down 59.8 points or 1.3 percent at 4,477.6. The broader All Ordinaries index is trading at 4,551.1, down 61.5 points or 1.3 percent from its previous close.
In the banking space, ANZ Bank, Commonwealth Bank of Australia, National Australia Bank and Westpac are down 1 to 1.5 percent now. Bendigo & Adelaide Bank and Bank of Queensland are trading lower by 2 percent and 1.6 percent respectively.
Macquarie Group shares are down by over 4 percent after the bank said its first-half results for fiscal 2012 would be lower than a year earlier because of a higher tax rate and the absence of a benefit included in the prior corresponding period. However, the bank said full-year results for fiscal 2012 would improve on the prior year, assuming market conditions did not worsen materially.
Shares of leading miners BHP Billiton and Rio Tinto are down 1.7 percent and 1.6 percent respectively. Fortescue Metals and Newcrest Mining are both trading lower by about 1 percent.
Iluka Resources, Onesteel, Paladin Energy and Oz Minerals are down 2 to 3.3 percent now.
Among energy stocks, Caltex Australia is down with a loss of over 2 percent. Woodside Petroleum, Santos, Oil Search and Origin Energy are down 0.9 to 1.3 percent.
Origin Energy announced that a final investment decision had been made on the coal seam gas to liquefied natural gas joint venture project with ConocoPhillips at Gladstone.
Wesfarmers shares are down 2 percent despite an announcement from the company that sales at its Coles supermarket chain rose 6.7 percent to A$31.77 billion in financial 2011. The retail giant reported that sales at its home improvement and office supplies divisions rose 5.4 percent to A$8.24 billion. Wesfarmers food and liquor divisions recorded a 6.3 percent increase in sales to A$25.03 billion for the same period.
Panaust, ResMed, Seven West Media, Myer Holdings, Ramsay Healthcare, Goodman Group, James Hardie Industries and QBE Insurance are trading sharply lower.
In the currency market, the Australian dollar was quoting at US$1.1023 in early trades, down from Wednesday's close of US$1.1055. The Australian dollar is currently trading at 1.1018 to the U.S. dollar.
The Japanese stock market was opened lower with investors pressing sales almost across the board. Besides weak cues from Wall Street, the yen's strength against the dollar too contributed to the decline.
Automobile, banking, retail, non-ferrous metals and foods stocks were mostly down with notable losses. The benchmark Nikkei 225 index, which declined to 9,913.5 in early trades, was down 112.1 points or 1.1 percent at 9,935.1 at the end of the morning session.
Advantest Corp shares were down by over 7 percent. NTT Data lost 6 percent on reports the company could see a fall in earnings in the April-June 2011 quarter. Tokyo Electric Power was down more than 5 percent.
Heiwa Real Estate, Nippon Steel, Oki Electric, Mitsubishi Paper, Japan Steel Work, Konami, Yokogawa Electric, Mitsumi Electric, Sumco and Inpex were down 2 to 4 percent at the break.
Automobile stocks Toyota Motor, Honda Motor, Suzuki Motor, Isuzu Motors and Nissan Motor were trading lower by 1 to 2 percent.
Among bank stocks, Mitsubishi UFJ Financial, Mizuho Financial, Bank of Yokohama and Shizuoka Bank posted notable losses.
Hitachi Construction Machinery gained nearly 4.5 percent. NTN Corp., Panasonic Corp., Chugai Pharma and Japan Tobacco also posted strong gains.
In economic news, retail sales in Japan climbed 1.1 percent on year in June, the Ministry of Economy, Trade and Industry said on Thursday, standing at 11.137 trillion yen. That was well above forecasts for a 0.5 percent contraction following the 1.3 percent decline in May.
On a seasonally adjusted monthly basis, retail sales jumped 2.9 percent - again blowing past expectations for a 1.5 percent rise following the 2.4 percent gain in the previous month.
Sales from large retailers saw a decline of 0.5 percent on year to 1.603 trillion yen. That compares to forecasts for a 0.4 percent fall following the revised 2.5 percent contraction a month earlier. The data also showed that wholesale sales climbed 3.5 percent on year and commercial sales collected an annual 2.9 percent.
According to the data released by the Ministry of Finance, Japanese residents purchased a net 61.7 billion yen in foreign stocks for the week ended July 23 and sold a net 224.0 billion yen in foreign bonds and notes. Foreign investors bought a net 2.3 billion yen in Japanese stocks last week, the ministry noted, and they also sold a net 146.0 billion yen in Japanese bonds and notes.
In the currency market, the U.S. dollar traded in the upper 77 yen range in early deals in Tokyo. The yen is currently trading at 77.90 yen to the U.S. dollar.
The South Korean market too is trading notably lower despite strong economic data. The benchmark KOSPI is down 18.7 points or 0.8 percent at 2,155.6.
According to a report from the Bank of Korea, South Korea saw a current account surplus of $2.99 billion in June. That beat forecasts for a surplus of $2.7 billion following the downwardly revised surplus of $2.18 billion in May. The original reading for the previous month was for a surplus of $2.26 billion.
Among other markets in the Asia-Pacific region, Shanghai, Hong Kong, Indonesia, Singapore and Malaysia are down with notable losses. New Zealand and Taiwan are also trading weak. Markets across the region turned in a mixed performance on Wednesday.
On Wall Street, stocks declined sharply on Wednesday amid worries about a government default following the U.S. lawmakers continuing to struggle to reach an agreement on raising the debt limit. An unexpected drop in durable goods orders in the month of June and slow pace of growth in many of the twelve Federal Reserve districts too contributed to the slide.
The Dow ended down 198.7 points or 1.6 percent at 12,302.5, the Nasdaq plummeted 75.2 points or 2.7 percent to 2,764.8 and the S&P 500 closed with a loss of 27 points or 0.2 percent at 1,304.9.
Major European markets too ended notably lower on Wednesday. The U.K.'s FTSE 100 index ended down 1.2 percent, while the French CAC 40 index and the German DAX index lost 1.3 percent and 1.4 percent respectively.
Crude oil prices drifted lower on Wednesday amid growth worries following the delay in the U.S. government's plan about deciding on raising the debt limit. Weak economic reports too contributed to the fall. Light, sweet crude for September delivery ended down $2.19 at $97.40 a barrel on the New York Mercantile Exchange.
Copyright RTT News/dpa-AFX