Asia Market

The major Asian markets ended Wednesday’s session on a mixed note, as profit taking took some sheen off the optimism generated by positive corporate earnings.

Japan’s Nikkei 225 average traded tentatively in early morning trading before taking off and moving steadily higher. The index closed up 71.14 points or 0.74% at 9,723, closing higher for the sixth straight session.

Electronics and electric machinery makers saw some strength. JFE Holdings rallied 6.11% and Keisei Electric Rail rallied close to 5%. Mitsui Chemicals rose 6.87%. The auto space showed mixed sentiment, while financial stocks ended mostly lower.

Australia’s All Ordinaries showed some tentativeness in early trading, but it rose decisively thereafter. Nevertheless, the index moved mostly sideways in a narrow range before closing up 20.60 points or 0.51% at 4,069.

Energy and material stocks once again led the advance, with BHP Billiton, Fortescue, Rio Tinto and Woodside Petroleum ending in positive territory. However, Newcrest Mining, Lihir Gold and Oil Search fell. In the banking space, ANZ Bank rose, while Commonwealth Bank and Westpac receded.
Trading in National Australia Bank was halted following news that the bank is planning to raise as much as A$2.75 billion through the sale of shares in an effort to weather its rising bad loans and also to fund potential acquisitions.

Meanwhile, Hong Kong’s Hang Seng Index, which held slightly above the unchanged line in the morning session, receded sharply in the afternoon to close down 253.56 points or 1.30% at 19.248.
Twenty-nine of the forty-two index components ended the session lower, with property, financial stocks responsible for much of the weakness. China-related stocks also ended mostly lower. On the other hand, resource stocks showed some strength.

Currency, Commodity Futures

Crude oil futures for September delivery in their first day of trading as the front month contract are down $0.91 at $64.70 a barrel. The August futures expired on Tuesday at $64.72 a barrel, up $0.74.

Gold futures are edging down $0.10 at $946.80 an ounce. In the previous session, the precious metal fell $1.90 to $946.90 an ounce. A weaker dollar and a rise in equity markets, both of which reflect increasing optimism about an economic recovery, have been responsible for much of the recent increase in oil prices. OPEC has also been suggesting that they may go in for further production cuts if the demand for OPEC oil doesn’t pick up.

That said, OPEC’s statement lacks credibility, as they have not been strictly adhering to the already announced production cuts. The recent run up increases the risk of a correction.

On the currency front, the U.S. dollar is trading at 93.33 yen compared to the 93.745 yen it fetched at the close of New York trading on Tuesday. The greenback is currently valued at $1.4191 versus a euro.