Japan and India Indexes Trade Lower, Hong Kong Stocks Rebound

Arjun Pandit
14 Feb, 2024
Mumbai

Across Asia, market indexes declined in Japan, Korea, and Indonesia, and financial markets remained closed in China. 

Overall inflation fell to an annual pace of 3.1% in January, and core inflation, which excludes food and energy prices, stayed at 3.9%, significantly higher than the Federal Reserve's target rate of 2%.

Hotter-than-expected inflation in January supported the case for the Federal Reserve to wait for a while before lowering inflation, denting the critical assumption behind the market rally over the last three months. 

Higher inflation suggests that the U.S. dollar is likely to advance and stock market indexes are likely to face downward pressures in the days ahead.

 

Japan Stocks Faced Selling Pressure 

The Nikkei 225 average fell, tracking losses in overnight trading on Wall Street following the release of hotter-than-expected U.S. inflation in January. 

The Nikkei 225 decreased 0.7% to 37,702.85 and eased from the 34-year high reached in the previous session. 

The yen weakened to 150.25 against the U.S. dollar after U.S. rate-cut hopes were pushed back following the inflation report. 

Exporters were among the leading decliners, and tech companies led the gainers. 

Toyota Motor, Sony Group, Panasonic, Canon, Japan Tobacco, and Nippon Steel declined between 2% and 3%. 

Advantest, Screen Holdings, Tokyo Electron, and Renesas Electronics gained between 0.5% and 1.0%. 

Citizen Watch soared 5.9% to ¥1,049.0 after the company reported better-than-expected quarterly results. Sales in the fiscal third quarter rose 4.2% to 859 billion yen, and net income attributable to shareholders increased 2% to 73 billion yen. 

Seiko Group advanced 0.5% to ¥2,738.0, following Citizen's results. 

Sapporo Holding soared 7.7% to ¥7,406.0, and Idemitsu Kosan added 2.6% to ¥852.60 after the energy exploration company reported better-than-expected earnings. 

  

Hang Seng Index Erased Morning Losses 

The Hang Seng index advanced 0.3% to 15,797.59, and the benchmark index erased a 1.2% decline in the morning session after investors returned from a long weekend to celebrate the Lunar New Year. 

Financial markets in mainland China and Taiwan are closed for the rest of the week. 

Property developers continued on the downward path due to the ongoing worries of weak demand and a lack of specific stimulus from policymakers. 

Longfor, China Resources Land, China Vanke, and Sun Hung Kai Properties declined between 1% and 3%. 

New World Development, Budweiser Brewing, and Xinyi Glass declined around 1% after MSCI included these three companies in the list of 66 Chinese companies scheduled to be removed from its global standard index at the end of this month. 

 

India Indexes Extend Losses

Stocks in Mumbai and Asia faced selling pressure after U.S. inflation was higher than expected in January. 

The Sensex and the Nifty indexes dropped about 0.5% in early trading and dragged down tech service providers and banks after the release of the U.S. inflation report. 

The Sensex index decreased 77.60 points to 71,087.45, and the Nifty index fell 17.70 points to 21,597.02.

On the Mumbai stock exchange, 89 stocks traded at their 52-week highs and 31 stocks traded at their 52-week lows.

Adani Group stocks were in focus after the U.S.-based rating agency Moody's Investor Service revised its outlook on four group companies to "stable" from "negative."

The ratings agency had lowered its outlook on Adani Green, Adani Electricity Mumbai, Adani Transmission, and Adani Energy Solutions after the U.S.-based short seller launched a media attack a year ago.