China housing data drag on Asia markets
HONG KONG (MarketWatch) -- Asian stocks kicked off the trading week on a downbeat note Monday, with Chinese policy makers seen as less inclined to cut interest rates after data showed real estate prices rising in a majority of major cities.
The Shanghai Composite Index (000001) ended down 0.4%, paring a sharper decline that had put the index at a low for the year.
The Shenzhen Composite Index edged up 0.3%. Hong Kong's Hang Seng Index (HSI) fell 0.1%.
Analysts said investors reacted negatively to signs that Beijing will continue, or even extend, its property-tightening measures after a government inspection concluded that the housing market was heating up.
"This is a firm statement from the State Council that they will continue property-curb policies, and is not the change that the market had been expecting. The market was sort of blindsided by that." Reorient Financial Markets' head of research, Steve Wang, in Hong Kong said.
Home prices rising
Statistics Bureau figures for July, released over the weekend, showed new home prices rising in 49 of 70 Chinese cities, the broadest-based gains in 14 months.
Piper Jaffray sales trader Andrew Sullivan said the housing results were the first full-month data since the People's Bank of China lowered interest rates in June. He added that the rebound likely augured for curbs on additional easing.
Japan's Nikkei Stock Average (100000018) ended the session up 0.1%. The move extended a currency-aided advance made Friday when it closed at its highest level in more than three months.
Markets in India, Indonesia, Singapore and Philippines were closed for public holidays.
Market `lacks direction'
U.S. stocks had ended with mild gains Friday, notching a sixth weekly advance, helped by a rise in consumer sentiment and lingering optimism over Europe. Read more on Friday's U.S. stock action.
The gains didn't translate into Asia, however, and Ben Kwong, chief operating officer at KGI Asia, said, "I think that the market is still lacking clear direction. ... Future upward momentum will need further stimulus measures.
"In the absence of major news from overseas, investor focus is on company announcements. Results announcements haven't been that good over the past few days."
Firms recently reporting poorly received earnings included Aluminum Corp. of China (2600) (ACH) . The shares fell another 1.2% to extend a loss from Friday when the firm reported a loss for the first half of the year.
"Any indication that prices are likely to average less than $100 per tonne over the medium term may put further downward pressure on some resource stocks," said Ric Spooner, chief market analyst at CMC Markets in Sydney.
Other decliners included South Korea's
The electronics giant fell 3.8% on Friday after a judge hearing Samsung's patent-dispute litigation with
Both the euro and the dollar held onto Friday's gains against the Japanese yen in early trading on Monday. Credit Agricole strategists said that they expect further selling of the Japanese currency this week, as a more risk-prone market exits the safe-haven Japanese yen.
Anti-Japanese protests in China intensified on Sunday after a group of Japanese activists landed on an island claimed by both nations, reports from the region said. In some cases, Chinese protesters vandalized Japanese-made cars and Japan retail outlets. Read more on protests.