Asian stock markets were mixed Thursday, with some exporters in Tokyo reversing early losses as the yen eased off from early highs, while banks and brokerages fell in Shanghai after data showed China's economy slowed in the third quarter.
Japan's Nikkei Stock Average fell 0.1%, while Australia's S&P/ASX 200 rose 0.2%, South Korea's Kospi Composite fell 0.3% and India's Sensex rose 0.4%. Hong Kong's Hang Seng Index lost 0.3%, Taiwan's main index fell 0.1% and the Shanghai Composite index was down 1.2%. Dow Jones Industrial Average futures were five points higher in screen trade.
Wall Street's solid rebound on Wednesday, buoyed by a spate of strong earnings from airlines and other bellwethers, provided early impetus in Asia. Receding fears that China's surprise rate hike on Tuesday will dent global growth helped to steady most markets.
A raft of data from China, which mostly came in line with market expectations, left investors with few fresh drivers. "The China data came in as expected. The two figures watched most closely were gross domestic product and the consumer price index," said David Taylor, market analyst at CMC Markets in Sydney. Markets were "nervous about Chinese inflation but at present it does not appear to be a concern," he said.
The Japanese market pared early losses after the yen turned lower from early highs in response to comments from U.S. Treasury Secretary Geithner in a Wall Street Journal interview. Geithner said the major currencies are "roughly in alignment now," suggesting there's no need for further U.S. dollar weakness.
"The fact that investors reacted so nervously to such comments suggests the dollar/yen pair is reaching the kind of level" that will trigger a technical rebound, said Yutaka Yoshii, general manager at Mito Securities.
Some exporters turned higher in the afternoon session, with Sony up 2.2%, Tokyo Electron up 1.4%, and Mazda Motor 0.4% higher. However, investors remained wary as the yen resumed its upward trend after the Geithner-led brief selloff. Canon was off 0.8% and Honda Motor gave up 0.6%.
Banks and brokerage houses were leading losses in China as investors took profit.
Data earlier Thursday showed the country's growth slowed in the third quarter, but this "is not bearish" for the economy since most investors understand the high base effect and they have priced in the third quarter slowdown, said Bank of America-Merrill Lynch economist Lu Ting.
China's gross domestic product rose 9.6% from a year earlier in the third quarter, slowing from 10.3% growth in the second quarter, as Beijing continued to withdraw stimulus and took measures to cool sectors such as the property market.
However, the expansion was slightly above market expectations for a 9.5% rise, according to the median forecast of 14 economists. Other indicators such as September inflation data suggested that China's economy is still heading for a soft landing.
Citic Securities fell 1.8% after rising more than 50% since the start of this month, while Changjiang Securities lost 2.4% and China Merchants Bank lost 3.6%.
"The upward trend (in stock market) remains intact because of inflation expectations and flush liquidity," said CSC International analyst Amy Lin.
Metal stocks extended their recent rally after commodity prices staged a rebound on Wednesday in New York. Yunnan Copper gained 2.3% and Jiangxi Copper rose 2.1%.
In Sydney, materials plays were leading a broad-based recovery in cyclical stocks after the previous session's punishing selloff. BHP Billiton was up 0.7%, Rio Tinto added 1.6% and Newcrest Mining tacked on 1.5%.
Wesfarmers was among the top performers, advancing 2.9% after its Coles supermarkets' comparable food & liquor sales rose 6.2% in the first quarter.
The South Korean market was hit by concerns about the earnings outlooks for key technology stocks after Samsung Electronics' recent downbeat third quarter guidance.
"Investors, disappointed by Samsung Electronics' weaker-than-expected (third quarter) guidance, seem to find no reason to buy technology stocks as major IT companies such as Hynix and LG Display have yet to come up with their quarterly results," said Lee Kyoung-min at Woori Investment & Securities.
Samsung Electronics was off 0.1% and LG Display fell 1.5%.
Hana Financial Group fell 6.2% after Singapore state-owned investment company Temasek Holdings sold its entire 9.6% stake in the firm at KRW33,400 per share, a 6.0% discount to Hana Financial's closing price on Wednesday.
A Hana Financial official said late Wednesday that Temasek had informed Hana of its intent to sell down its stake in the firm as it began divesting from various financial institutions in the wake of the global financial crisis.
In Taiwan, Acer rose 3.1% after the world's second-largest personal computer maker by shipments said Wednesday its unaudited net profit for the third quarter rose to a record NT$5.28 billion. The result represents an 11% increase from a net profit of NT$4.75 billion in the same period of last year.
Elsewhere, Malaysian shares were 0.3% higher, Singapore's Straits Times Index fell 0.5%, New Zealand's NZX-50 was up 0.5% and Indonesia's share market rose 0.2%.
In foreign exchange markets, the U.S. dollar briefly spiked to Y81.83 against the Japanese yen after the Geithner comments, before retreating to trade at Y81.21, but it remained above the Y81.16 level late Wednesday in New York. The euro was fetching $1.3930 against the dollar, above the $1.3872 intraday low but down from $1.3949 late in New York. The common currency traded at Y113.20 against the yen, from Y113.25.
Traders say the overall bearish-dollar trend isn't likely to reverse over the short term. Jun Kitazawa, senior dealer at Brown Brothers Harriman Investment Services, said the dollar won't sustain any gains against the yen. "It's not as if the U.S. is going to intervene" in the currency market to weaken the dollar, he said.
Lead December Japanese government bond futures were down 0.12 at 143.52 points as investors awaited the Ministry of Finance's Y1.1 trillion sale of 20-year bonds later in the day. The 10-year cash JGB yield was up one basis point at 0.900%.