Asian stocks turned in a mixed performance on Monday, as trading resumed after a holiday-shortened week. Investors continued to focus on developments in Cyprus after media reports indicated depositors with more than 100,000 euros in Bank of Cyprus could lose as much as 60 percent of their savings as part of a European bailout deal to save the country from bankruptcy.
The central bank said 37.5 percent of holdings over 100,000 euros will be converted into shares with voting rights and access to future dividends, while up to 22.5 percent will be temporarily withheld to ensure the lender meets the terms of its recapitalization. Meanwhile, Cyprus President Nicos Anastasiades affirmed his commitment of staying in the 17-nation currency bloc, while assuring Cypriots that financial situation is well contained.
Japanese shares fell sharply after the Bank of Japan’s closely-watched tankan survey showed business sentiment at Japan’s major manufacturers remained broadly pessimistic in the first three months of the year. The survey’s large manufacturers’ business sentiment index improved to minus 8 in March compared with minus 12 in December, while sentiment among large non-manufacturers improved to plus 6 in March from plus 4 in December.
The yen strengthened against other major currencies on safe-haven buying after the Bank of Japan’s tankan survey of business sentiment showed “Abenomics” —the Japanese PM’s policy approach involving a combination of aggressive monetary easing and fiscal stimulus -has yet to take root in the real economy. The Nikkei average lost 2.1 percent, while the broader Topix index plunged 3.3 percent.
China-related Komatsu and Hitachi lost 2-3 percent after data showed China’s factory output expanded at a slower-than-expected pace in March. Brokerage stocks like Nomura Holdings and Daiwa Securities Group fell 4-6 percent ahead of the central bank’s first policy-setting meeting under new Governor Haruhiko Kuroda this Wednesday. Panasonic, which is facing a bribery investigation in the U.S. declined 3.4 percent, while West Japan Railway slumped 7.2 percent on a Nikkei report that the government could introduce foreign capital restrictions in the industry.
China’s Shanghai Composite index slipped 0.1 percent to its lowest level since December 28 after government data on manufacturing fell below expectations. A survey by the China Federation of Logistics and Purchasing and the National Bureau of Statistics showed that China’s official purchasing managers index stood at 50.9 in March, the highest in 11 months but a tad lower than economists’ forecast of 51.2.
The HSBC index’s final reading, meanwhile, came in at 51.6 in March, slightly below the 51.7 recorded in the preliminary reading. Property stocks were in the spotlight after the government announced fresh tightening measures aimed at controlling the rising prices.
South Korea’s Kospi average dropped 0.4 percent, led by losses in tech and auto shares, after data showed South Korea’s exports grew less than expected in March. Exports climbed 0.4 percent in March from a year earlier following an 8.6 percent drop in February, the Ministry of Trade, Industry and Energy said in a report. Economists were forecasting 1.8 percent rise. With imports falling 2 percent annually, the trade surplus rose to $3.4 billion from $2 billion in February.
Elsewhere, benchmark indexes in India and Indonesia were slightly higher, while Singapore’s Straits Times index was little changed and Malaysia’s KLSE Composite index slipped 0.2 percent. India’s Sensex pared early gains after a survey by HSBC showed India’s manufacturing PMI grew at its slowest rate in the last 16 months in March.
The markets in Australia, Hong Kong and New Zealand were closed for Easter holidays. Stock markets in Europe are also closed for the extended weekend holiday, while Wall Street will reopen later in the day after a three-day holiday.
by RTT Staff Writer
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