MARKETS-ASIA/CLOSE Asia markets mixed on Iran deal, Greek debt and Beijing measures

Record ID: 147026

  • Title: MARKETS-ASIA/CLOSE Asia markets mixed on Iran deal, Greek debt and Beijing measures
  • Date: 15th July 2015
  • Summary: TOKYO, JAPAN (JULY 15, 2015) (REUTERS) EXTERIOR OF TOKYO STOCK EXCHANGE (TSE) BUILDING SIGN READING (English): "JPX, TOKYO STOCK EXCHANGE" ELECTRONIC STOCK BOARD ELECTRONIC STOCK BOARD SHOWING NIKKEI AVERAGE CLOSING AT 20463.33 UP 78.00 HONG KONG, CHINA (JULY 15, 2015) (REUTERS) VARIOUS EXTERIORS OF INTERNATIONAL FINANCE CENTER HEAD OF CHINA AND HONG KONG STRATEGY, CLSA, F
  • Embargoed: 30th July 2015 13:00
  • Keywords:
  • Topics: General
  • Reuters ID: LVADLQWFMAXO4O30BTX2CZN24FZ9
  • Aspect Ratio: 16:9
  • Story Text: Asian stocks closed with mixed results on Wednesday (July 15) as a renewed slide in Chinese equities eclipsed upbeat data from the world's second-biggest economy, while the euro slipped ahead of a Greek parliamentary vote on austerity measures.
    Japan's Nikkei gained 0.4 percent to 20,463.33, the highest closing level since July 3 as investors were relieved that the worst may be over for the debt crisis in Greece, with stronger-than-expected Chinese economic data giving an additional boost.
    The broader Topix climbed 0.5 percent to 1,646.41, with only 2.045 billion shares changing hands, the lowest in more than three weeks. The JPX-Nikkei Index 400 advanced 0.4 percent to 14,876.71.
    Hong Kong stocks were flat as investors watched China indexes slide as the country's better-than-expected economic data failed to cheer up mainland markets.
    The Hang Seng index fell 0.3 percent to end the day at 25,055.76 points, while the China Enterprises Index lost 1.3 percent to close at 11,681.20 points.
    While the markets were volatile in recent weeks, some analysts said they had little impact on China's economy.
    "The thing to keep in mind with the stock market, and this is a good thing, is that the rally wasn't that long. Mainly since the beginning of this year. So the positive wealth effect wasn't really seen, so the negative wealth affect shouldn't be that large given the government now has put a floor to the market. And I think most people have faith in the government. So I don't think it will affect consumption too much. There are two questions. If the market actually rallied longer, you would have had a much better, larger impact on the economy. Secondly, what does the government do now with the market, which is still actually pretty expensive," said Francis Cheung, who is the head of China and Hong Kong strategy.
    China's second quarter gross domestic product grew an annual 7.0 percent, steady with the previous quarter and slightly better than analyst forecasts. Fixed-asset investment and industrial output growth also beat economists' forecasts.
    Cheung said the growth was unexpected.
    "The reason I'm surprised it hit 7 percent is that GDP targets going forward are no longer hard targets. Like last year it didn't hit the 7.5 percent target. And most people were expecting it to come in below 7 this year. So I think that's the right thing to do. These targets are no longer mandated. It's OK to come below them. So you may see a miss still in the second half of the year," Cheung said.
    Further stimulus is still expected after the quarter ended with a savage correction that shaved about 30 percent off share market value since last month, before Beijing's support steps stemmed the freefall for a while.
    China stocks tumbled in afternoon trade on Wednesday, despite the positive official economic data, as a recent post-rout, government-triggered rebound appears to be running out of steam.
    The CSI300 index of China's largest listed companies tumbled over 5 percent at one point, but eased some losses to end the day down 3.5 percent, at 3,966.76. The Shanghai Composite Index lost 3.0 percent, to 3,805.70 points.
    The slide highlights the ongoing difficulty Beijing faces as it seeks to restore confidence in its stock market without signalling investors that it is guaranteeing zero-risk free for all, which would simply reinflate a rally that even regulators said had become too frothy.
    Some investors in Beijing said they were uncertain about the equity market.
    "I am veering toward being more pessimistic. The extent of the government involvement was too huge, so it's very uncertain that how far the markets can go, so it's better to be cautious at this current stage, that's how I'm judging it," said 26-year-old investor Xia Chunzhen in China's financial hub Shanghai.
    Seoul shares rose on Wednesday as builders led gains on expectations for increasing orders from Iran after Tehran and world powers reached a nuclear deal, bolstered by foreign buying in the main board.
    The Korea Composite Stock Price Index (KOSPI) was up 0.7 percent at 2,072.91 points from the previous close of 2,059.23.
    Foreigners purchased a net 230.2 billion won ($201.30 million), preliminary data showed.
    The won closed local trade at 1,143.6 against the dollar, barely changed from the previous close at 1,142.6 ahead of Federal Reserve Chair Janet Yellen's semi-annual testimony on monetary policy later in the global day.
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