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Asian stocks advance; Kospi widens gains after BOK decision

See Kit Tang
Asian stocks advance; Kospi widens gains after BOK decision

Asian stocks moved higher early Thursday, shrugging off a tepid open brought about by an unimpressive lead from offshore markets.

Wall Street finished in the red overnight, as investors digested mixed results from the banking sector as well as the release of lower-than-expected sales forecasts for fiscal 2016 by Wal-Mart (WMT).

The Dow Jones Industrial Average (Dow Jones Global Indexes: .DJI) dropped nearly 1 percent, ending below the psychologically key level of 17,000 for the first time since October 7, on the back of declines in Wal-Mart and Boeing (BA). The S&P 500 (CME:Index and Options Market: .INX) and Nasdaq Composite (^IXIC) ended 0.5 and 0.3 percent lower respectively.

Mainland markets up

China's share markets opened higher on Thursday, with the Shanghai Composite edging up 0.7 percent.

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The benchmark CSI300 Index elevated 0.6 percent, while the smaller Shenzhen Composite ticked down 0.5 percent.

Nikkei bounces 0.8%

Japan's Nikkei 225 (Nihon Kenzai Shinbun: .N225) index changed course in early trade to reclaim 18,000 points, after finishing under the level for the first time since October 2 in the previous session.

A tick down in dollar-yen (Exchange:JPY=) probably encouraged risk appetite for exporters. Blue chips such as Toyota Motor (Tokyo Stock Exchange: 7203.T-JP) and Sony (Tokyo Stock Exchange: 6758.T-JP) pared earlier declines to rise 0.8 and 0.5 percent respectively, while Panasonic (Tokyo Stock Exchange: 6752.T-JP) halved losses to 1.5 percent.

Counters which came under pressure due to their heavy exposure to China, also recovered their footing. Komatsu (Tokyo Stock Exchange: 6301.T-JP) eked out marginal gains, while Fast Retailing (Tokyo Stock Exchange: 9983.T-JP), owner of clothing brand Uniqlo, bounced up 0.9 percent.

Defying the rebound, shares of Asahi Kasei (Tokyo Stock Exchange: 3407.T-JP) tanked nearly 10 percent on the back of news that its subsidiary performed faulty installation of a portion of foundation piles in work for a Yokohama apartment complex, Reuters reported.

ASX gains 0.3%

Australia's S&P ASX 200 (^AXJO) index nudged up, on course to snap a three-session losing streak, as the key resources sector enjoyed some reprieve following a sharp sell-off in previous sessions.

BHP Billiton (London Stock Exchange: BLT-GB) and Rio Tinto (London Stock Exchange: RIO-GB) rallied more than 1 percent each, while Fortescue Metals (ASX:FMG-AU) elevated nearly 6 percent on the back of news that the miner's production costs were beating its fiscal 2016 target.

Evolution Mining (ASX:EVN-AU) rocketed 10 percent, while Newcrest Mining (ASX:NCM-AU) and Kingsgate Consolidated soared 4.1 and 5.4 percent respectively, as gold prices hit a three-and-a-half-month peak after soft U.S. data and concerns over deflationary pressures in China fueled expectations that the Federal Reserve will hold off raising interest rates.

Energy producers also turned higher, with battered shares of Oil Search (ASX:OSH-AU) and Santos (: ) up 4.3 and 2.3 percent respectively.

A string of corporate news released before the market open were also eyed. Insurance Australia Group (ASX:IAG-AU) (IAG) soared 5 percent on the back of news that it plans to pause further investments in China. A statement released by the insurer on Thursday said that IAG will be pursuing "further growth opportunities in other Asian markets and our core businesses in Australia and New Zealand."

Australia and New Zealand Banking Group (ASX:ANZ-AU) (ANZ), which said it will be selling its New Zealand medical insurance business to NIB NZ, dropped 0.9 percent.

Kospi rises 1.1%

South Korea's Kospi index headed further north in early trade, after the Bank of Korea (BOK) kept interest rates steady for a fourth straight month, in line with expectations.

The bourse's top two weighted stocks Samsung Electronics (Korea Stock Exchange: 593-KR) and Hyundai Motor (Korea Stock Exchange: 538-KR) climbed 1.4 and 0.3 percent respectively, while utility Kepco advanced 0.9 percent.

Lotte Group shares were in focus following new developments in a family feud that has shrouded the country's number 5 conglomerate in recent months. On Wednesday, chairman Shin Dong Bin lost his directorship at Japan-based Kojunsha Corp, the group's virtual holding firm, in the latest move taken by his older brother Shin Dong-joo amid a power struggle over control of the group.

Lotte Shopping (Korea Stock Exchange: 2353-KR) and Lotte Chemical rose 1.2 and 3.1 percent respectively, but Lotte HiMart eased 1.5 percent. Lotte Confectionery (Korea Stock Exchange: 499-KR) traded flat.

Meanwhile, Bank Indonesia (BI) is also projected to stand pat on Thursday, maintaining its policy rate at 7.5 percent.

"The currency remains under pressure after a strong selloff on fears of U.S. monetary policy normalization," a note by Moody's Analytics released last Friday said.



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