Asian stock markets continued to benefit from weaker oil prices on Wednesday, with Tokyo further helped by renewed strength for export-dependent stocks as the dollar held onto most of its recent gains against the yen.
The Nikkei 225 Average finished 0.5 per cent higher at 11,827.16, while the Topix was 0.5 per cent stronger at 1,196.23.
Honda Motor was 1.3 per cent stronger at Y5,600, Toyota added 1.2 per cent to Y4,130, NEC rose 0.8 per cent to Y655 and Canon was 1 per cent stronger at Y5,860.
But oil exploration stocks slipped as crude prices fell back. Inpex, Japan’s largest oil explorer, was 1.3 per cent softer at Y606,000 while AOC Holdings shed 4.1 per cent to Y1,628.
Aeon, Japan’s largest retailer, was down 0.1 per cent at Y1,812 as it said it would take a charge of Y79bn to write down the value of stores it is expected to close and on other assets.
Nintendo, the video games maker, added 3.6 per cent to Y12,250 after it confirmed reports it would raise its dividend from Y140 to Y270 for the financial year to March 2005.
Shipbuilding stocks were higher after UBS said growing freight volumes from North America and the rest of Asia would benefit the sector. Mitsui, Japan’s second largest shipping line, rose 2.6 per cent stronger at Y707, while Kawasaki Kisen ended 2.2 per cent higher at Y758. Nippon Yusen, Japan°s largest shipping group, was 2 per cent firmer at Y668.
Chugai Pharmaceuticals, owned by Switzerland’s Roche, was 0.4 per cent higher at Y1,665 after it raised its six-month profit estimate to June 30 by 14 per cent, thanks to increased sales of Tamiflu, the influenza treatment.
Regional banks came under further pressure as tracker funds continued to react to the Tokyo Stock Exchange’s plans to turn the Topix index into a “free-float” index.
The TSE said it would introduce an adjustment for stocks with low liquidity, such as regional banks, not just the amount of stock available to trade.
Tohoku Bank lost 4.9 per cent to Y312 while Kanto Tsukuba Bank was 3.8 per cent weaker at Y810 and Bank of Iwate was 3.4 per cent softer at Y6,230.
Nippon Filcon jumped 8.6 per cent to Y1001 as the market gave its backing to the engineering group’s strong first-quarter results.
Shanghai rallied strongly as bargain-hunters moved in following two days of losses. The composite index rose 1.9 per cent to 1,214.87 after spending last week bumping along at six-year lows last week.
Huaneng Power International jumped 3.4 per cent to Rmb7.36, its biggest rise for more than month, after the government said it would allow electricity companies to pass on higher costs to customers.
Sinopec, the oil refiner, rose 2.4 per cent to Rmb4.29 but remains about 4 per cent down from levels seen at the end of March.
But steel stocks were hit by fresh concerns about rising raw materials costs. Baoshan Iron and Steel shed 1 per cent to Rmb6.09 while Wuhan Iron and Steel fell 2.7 per cent to Rmb4.
Hong Kong focused on telecoms stocks amid speculation that the industry in China would soon face restructuring to ease competition and pave the way for next-generation mobile services. The Hang Seng index rose 0.4 per cent to 13,562.26.
China Unicom, the country’s second-biggest mobile operator, rose 5 per cent to HK$6.25 on talk that its second-generation cellular network could be merged with fixed-line carrier China Netcom. Netcom shares eased 0.9 per cent to HK$10.70 while leading wireless operator China Mobile firmed 1.8 per cent to HK$25.75.
Seoul rose to a three-week high as oil prices continued to ease back, although the mood was slightly cautious ahead of today’s [thursday’s] Bank of Korea policy-setting meeting.
The composite index rose 0.6 per cent to 988.00.
Hyundai Motor, South Korea’s leading carmaker, rose 2.3 per cent to Won56,900 while affiliate Kia Motors firmed 1 per cent to Won14,550.
In the tech sector, Hynix Semiconductor rose 1.4 per cent to Won14,100 while flat panel maker LG.Philips LCD gained 1.2 per cent to Won46,400.
Kuala Lumpur tumbled to a five-month low as market heavyweight Telekom fell 2.6 per cent to M$9.25 amid fears about a possible mobile phone price war.
The sell-off filtered through to the banking sector, where Malayan Banking, the country’s largest lender, fell 2.7 per cent, to M$10.90.
The composite index closed 0.9 per cent lower at 861.75.