Asia mixed after China easing

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It was a mixed picture for Asian shares after China took further steps to shore up its slowing economy by cutting banks’ reserve requirements, while concerns about Greece’s possible exit from the eurozone were still high.

The FTSE Asia Pacific index lost 0.7 per cent to 227.81 while Japan’s Nikkei 225 Stock average was up 0.2 per cent to 8,973.84, Australia’s S&P/ASX 200 index was 0.3 per cent higher to 4,296.99. South Korea’s Kospi Composite index was down 0.2 per cent to 1,913.73.

China introduced more easing measures over the weekend by cutting banks’ reserve requirement ratio 50 basis points to support the cooling economy. The policy move, which came after a string of disappointing economic data for April, will take effect on May 18.

“We consider this policy move as a response to the weaker than expected April economic and new loan data,” said analysts at Deutsche Bank.

Hong Kong’s Hang Seng index lost 1.2 per cent to 19,735.04 while China’s Shanghai Composite index lost 0.6 per cent to 2,380.73.

Real estate developers rallied on Saturday’s easing measures with Henderson Land Development up 0.6 per cent to HK$40.20, Agile Property Holdings 1.2 per cent higher to HK$8.46 and Hang Lung Properties up 0.2 per cent to HK$25.60 in Hong Kong.

But gains were limited amid concerns about Europe after Greek party leaders failed to form a government.

Worries about Europe’s economic outlook pushed exporters lower. In Hong Kong, Esprit Holdings lost 5.8 per cent to HK$14.20 and Lenovo Group slumped 4.6 per cent to HK$6.88. Hyundai Motor, South Korea’s largest automaker by sales, gained 1 per cent to Won250,500 and its affiliate Kia Motors slid 0.4 per cent to Won80,300 in Seoul. Nissan Motor, which reported earnings on Friday, declined 2 per cent to Y788 in Tokyo although its net profit more than doubled.

But financials rebounded after recent losses, following US banking group JPMorgan’s large trading loss. Daiwa Securities Group gained 1.1 per cent to Y270 in Tokyo while Matsui Securities rose 1.2 per cent to Y435 and Sumitomo Mitsui Financial Group climbed 1 per cent to Y2,378.

In Sydney, Australia and New Zealand Banking Group gained 0.7 per cent to A$22.20 and National Australia Bank rose 1 per cent to A$24.80. In Hong Kong, Bank of China lost 1 per cent to HK$2.96; China Merchants Bank was 0.9 per cent lower at HK$15.16 and Agricultural Bank of China fell 1.2 per cent to HK$3.29.

In Tokyo, earnings forecasts weighed on market heavyweights. Takeda Pharmaceutical plunged 3.2 per cent to Y3,290 as investors were disappointed by the drugmaker’s operating profit forecast for this fiscal year.

Takeda forecast an operating profit of Y160bn for the year ending March 2013, much lower than market estimates of more than Y227bn.

Casio dropped 3.2 per cent to Y483 after the watch and calculator maker forecast earnings that were lower than analysts’ estimates. But retailer Fast Retailing, owner of the Uniqlo casual apparel brand, rose 2.3 per cent to Y16,820.

In Seoul, builders were weaker with Samsung Heavy Industries down 1.1 per cent to Won35,450 and Hyundai Heavy Industries off 1.4 per cent to Won256,500 in Seoul.

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