Singapore: Asian stocks fluctuated after a decline in oil and metal prices dragged down commodity shares and as Keppel Corp. reported earnings growth and Datang International Power Generation Co. forecast higher profit.
Mitsubishi Corp., Japan’s biggest commodity trader, lost 1.7% in Tokyo. Eisai Co. slumped 5% as its experimental drug to treat severe sepsis failed and at least four brokerages cut their investment ratings. Keppel, the world’s No. 1 builder of oil rigs, climbed 5.1% after reporting earnings that beat analyst estimates. Datang Power advanced 3.7% in Hong Kong after saying 2010 profit will rise 50%.
The MSCI Asia Pacific Index climbed 0.2% to 138.36 as of 7.33pm in Tokyo after falling as much as 0.1%. Seven stocks declined for every five that rose in the gauge. The measure had its first weekly drop in one-and-a-half months last week amid concern faster-than-expected economic growth in China will add pressure on policy makers to accelerate efforts to tame inflation.
“Concern about tightening in China looks overdone,” said Yoji Takeda, who helps manage about $1.1 billion at RBC Investment (Asia) Ltd in Hong Kong. “The economic environment is improving and corporate earnings are growing. That’s good for equities. The introduction of further stimulus measures in the US should help support jobs and the housing sector.”
Japan’s Nikkei 225 Stock Average slid 0.6%. South Korea’s Kospi Index climbed 1.1%. China’s Shanghai Composite Index rose 1.2%, while Hong Kong’s Hang Seng Index gained 0.2%. Australia’s market was closed on Wednesday for a holiday. Futures on the Standard and Poor’s 500 Index gained 0.4% on Wednesday. The index was little changed on Tuesday after equities erased losses in a late-session rebound as investors speculated president Barack Obama will announce plans to stimulate the economy.
Obama said in his annual State of the Union address to Congress that the nation’s deficit spending is unsustainable as he called for a freeze of some federal spending and signaled initiatives to improve US education, encourage innovation, and build roads, railways and telecommunications networks.
“At stake is whether new jobs and industries take root in this country, or somewhere else,” Obama said. “We are poised for progress.”
Mitsubishi Corp. slipped 1.7% to 2,306 yen in Tokyo. Mitsui & Co decreased 1.9% to 1,386 yen. Inpex Corp., Japan’s biggest energy explorer, slid 1.3% to 519,000 yen.
Crude oil for March delivery fell 1.9% on Tuesday to $86.19 a barrel in New York, the lowest settlement since 30 November, on signs that the economies of the US and the UK are struggling to recover. Also on Tuesday, gold futures for February delivery fell 0.9% to the lowest level in almost three months, and the London Metal Exchange Index of six metals including copper and aluminum slumped 2.5%, the biggest drop since 16 November.
Shares of Japanese exporters declined after the dollar dropped to as low as 81.98 yen on Wednesday, its weakest level in four days, reducing the value of US income at Japanese companies when converted into their home currency.
Toyota Motor Corp., the world’s biggest carmaker, slipped 1.9% to 3,400 yen. Nissan Motor Co., the Japanese carmaker that gets about 34% of sales from North America, dropped 1.3% to 835 yen. Sony Corp., the maker of Bravia televisions and PlayStation game consoles, retreated 1.9% to 2,865 yen. A gauge of healthcare companies posted the biggest decline among the 10 industry groups in the MSCI Asia Pacific Index. Eisai dropped 5% to 2,807 yen in Tokyo. Trials of its drug for sepsis failed to save more lives than a placebo in a final-stage study, prompting brokerages to cut ratings.