Asia stock markets traded mostly lower in a choppy session Thursday, with Japanese stocks swinging from gains to losses and then back to gains. Hong Kong's Hang Seng Index sat 0.1% lower after starting the session with gains, the Shanghai Composite Index lost 0.8%, South Korea's Kospi slipped 0.1%, and Singapore's Straits Times Index declined 0.3%. Japan's Nikkei Stock Average ended the day up 0.1%, after falling as much as 1.1% in the afternoon session. The index dropped 2.6% on Wednesday. Australia's S&P/ASX 200 index was a rare advancer, ending 0.4% higher. Markets are currently struggling to find momentum, said Perpetual Investments head of investment market research Matthew Sherwood. Continued concerns about Europe, U.S. government spending and elevated valuations have taken “all the wind from the markets spinnaker," he said. Along with other global markets, Asia shares have gained over the last three months. The Shanghai benchmark index, for example, hit a closing level Monday not seen since early June, as investors piled into financial stocks amid speculation that China would widen access to its capital markets. Belief that China's economic growth was recovering also helped sentiment, with the nation due to report fourth-quarter gross domestic product data Friday. But on Thursday, financial-sector stocks moved lower in Shanghai, with China Construction Bank Corp. down 1.9%, and Bank of Communications Co. lower by 1%. Over in Hong Kong, property stocks saw weakness, with China Resources Land Ltd. down 2.4%, while Evergrande Real Estate Group Ltd. fell 6.5% after announcing it planned to raise around $559 million by selling shares. “There are still some concerns that prices of property are very high in our view in relation to income — that's a risk," said Martin Hennecke, associate director at independent advisory firm Tyche Group. On the other hand, “we don't think the banking sector is as bad as people think," said Hennecke. Chinese banks are doing straightforward lending, he said, and have very high reserve-requirement ratios, so “we think they are reasonably safe" and look quite reasonably priced. While banks traded broadly lower in Hong Kong on Thursday, global banking major HSBC Holdings PLC bucked the trend to rise 0.7% after some solid results from U.S. rivals on Wednesday. For Japan, the focus remained squarely on currency factors, after the Nikkei Average hit a level not seen since April 2010 earlier in the week, thanks to the latest steep drop in the yen. The yen's moves were volatile, however, with the dollar losing ground but eventually rebounding to ¥88.67, up from ¥88.43 late Wednesday in North America. Exporters under pressure included Olympus Corp. losing 0.9%, Advantest Corp. off 0.8%, and Mazda Motor Corp. tumbling 2%. Renesas Electronics Corp. lost 1.7% after reports that the chip maker proposed to cut more than 3,000 jobs in discussions with its labor union. Some blue-chip exporters managed to gain, however, including Sony Corp. , which jumped 5.7% after an upgrade to neutral at Goldman Sachs. Similarly, Sharp Corp. surged 7.3% following a report in the Nikkei business daily that the consumer-electronics group was discussing a television partnership with Chinese computer manufacturer Lenovo Group Ltd. shares of which lost 1.2% in Hong Kong. Sharp later said that no decision has been made on its China TV business. Dreamliner woes hit airlines, others After the close of U.S. trading Thursday, the Federal Aviation Administration said it would ground all U.S.-registered Boeing Co. 787 Dreamliner planes, pending checks on whether the jets' batteries are safe. The FAA decision followed Wednesday's emergency landing in southern Japan by an All Nippon Airways Co. -operated 787 Dreamliner. ANA grounded its fleet of 17 Dreamliners on Wednesday after the incident, and its shares lost another 0.6% Thursday. Rival Japan Airlines Co. , which has five 787 Dreamliners in its fleet, rose 0.3%. Dreamliner battery maker GS Yuasa Corp. fell 5%. South Korean trading saw Hyundai Motor Co. gain 1.2%, and Kia Motors Corp. rise 0.7%, while Samsung Electronics Co. lost 1.7%. In Australia, investors moved into banks, pushing Westpac Banking Corp. higher by 0.7%, and Australia & New Zealand Banking Corp. up 0.8%. Data out Thursday showed that the country's jobless rate ticked up to 5.4% in December from 5.3% in November, although the rise was in line with economist expectations. CommSec economist Savanth Sebastian said: “It's clear that the job market isn't shooting the lights out, but by no means is unemployment soaring." Asia's performance Thursday followed a mildly positive session Wednesday on Wall Street amid a wait-and-see attitude from investors as earnings continue to roll out. Marketwatch
