(RTTNews) – The stock markets in the Asia-Pacific region, with the exception of Japan and New Zealand, are trading lower on Tuesday despite the modest gains overnight on Wall Street. Traders remained cautious ahead of a slew of economic data due this week as well as the U.S. Federal Reserve’s first meeting for the year starting Tuesday. Markets in Australia are closed for a public holiday.

On Wall Street, stocks closed on the upside by modest margins on Monday, as general economic optimism overcame disappointing news from the housing market and a mixed batch earnings reports. The major averages all closed in positive territory after a choppy session, snapping a three-day losing streak.

The Dow advanced by 23.88 points or 0.2 percent to 10,196.86, the Nasdaq closed up 5.51 points or 0.3 percent at 2,210.80 and the S&P 500 rose by 5.02 points or 0.5 percent to 1,096.78.

Crude prices closed slightly higher on Monday after falling sharply last week, weighed down by unseasonably warm temperatures in the U.S. and a stable greenback. The price of crude for February rose US$0.72 to US$75.26 a barrel, as the dollar held its ground versus the euro even after a successful bond offering in Greece soothed fears about debt problems in the European Union.

The Japanese stock market was trading higher on Tuesday following the modest rebound overnight on Wall Street and on the back of a stable dollar. However, the gains were limited by caution ahead of corporate earnings and economic data, including the Bank of Japan’s decision on interest rates.

The benchmark Nikkei 225 Index closed the morning session at 10,525.96, up 13.27 points or 0.13%. The broader Topix index of all First Section issues on the Tokyo Stock Exchange was up 0.61 points or 0.07% to 935.20.

On Monday, the Nikkei 225 index declined 77.86 points or 0.74% to close at 10,512.69, while the Topix index declined 6.35 points or 0.7% to 935.

On the economic front, the Bank of Japan will conclude its two-day monetary policy meeting on Tuesday and then announce its decision on interest rates. Analysts are expecting the bank to keep rates on hold at the record low 0.10%, but will be scrutinizing the commentary for clues as to the future direction of policy.

Meanwhile, corporate service prices in Japan were down 1.5% on year in December to an index score of 97.8, the Bank of Japan said on Tuesday. That matches forecasts following the revised 2.2% annual decline in November. On a monthly basis, corporate service prices were flat following the revised 0.2% fall in November.

In the currency market, the U.S. dollar was trading in the lower 90 yen range on Tuesday. In late morning trades, the dollar was quoted in a range of 90.39-90.42 yen, up 0.18 yen from Monday’s close of 90.21-90.24 yen in Tokyo.

Automotive stocks are trading mixed. Honda Motor was unchanged, while Suzuki Motor is up 1.50% and Nissan Motor is adding 0.54%. Meanwhile, Mitsubishi Motor is losing 0.75%. and Toyota Motor Corp. is down 2.5%. According to reports, Toyota will expand its massive recall of vehicles with defective gas pedals into Europe, further denting the auto maker’s reputation in the area of quality control.

Banking stocks are mostly trading lower. Resona Holdings is adding 0.52%, while Sumitomo Mitsui Financial is down 0.57%. Mizuho Financial is losing 1.06% and Mitsubishi UFJ Financial is down 0.21%.

Trading companies are in positive territory. Mitsubishi Corp. is adding 0.66%, Sumitomo Corp. is gaining 2.56%, Toyota Tsusho Corp. is advancing 1.12% and Mitsui & Co. is up 27.42%.
Shares in Hoya Corp. opened higher, but pared gains and are down 1.3% as investors apparently moved to lock in profits after the stock rose to a year-to-date high last Thursday.

Shares of KDDI Corp. are down 7% after the mobile carrier on Monday downgraded its net profit forecast for fiscal 2009. The company had also announced that it will become the leading shareholder in Jupiter Telecommunications Co., or JCOM, Japan’s largest cable television company. Meanwhile, shares of Jupiter Telecommunications are down 8.14%.

The South Korean stock market was trading lower on Tuesday after weaker-than-expected fourth-quarter GDP data dampened investors hopes of an early recovery. Tech shares were lower on profit-taking despite positive earnings results from Apple and Texas Instruments on Monday.

In late morning trades, the benchmark Korea Composite Stock Price Index, or KOSPI, is down 17.52 points or 1.05% to 1,652.68. On Monday, KOSPI Index had ended in negative territory with a loss of 14.15 points, or 0.84%, at 1,670.

The Bank of Korea said on Tuesday that South Korea’s economy expanded by 0.2% in the fourth quarter of 2009, compared to the previous three months. That was slightly below analyst expectations for a 0.3% quarterly gain in gross domestic product following the 3.2% increase in the third quarter. For all of 2009, GDP was 0.2% higher than in the previous year.

The data may push back the central bank’s plan to begin withdrawing stimulus in the form of interest rate hikes. Some analysts were already pricing in a rate hike at next month’s monetary policy meeting.
In the currency market, the South Korean won was trading at 1,145.8 won to the U.S. dollar, up 4.2 won from Monday’s close of 1,150.0 won.

Key exporters including tech firms and automakers are leading the falls in the broad equity index on Tuesday.

In the tech space, market heavyweight Samsung Electronics is down 1.66%, Hynix Semiconductor is down 6.9%, LG Display LCD is down 2.98% and LG Electronics is losing 0.46%.

Among automobile stocks, Hyundai Motor is losing 3.6% and Kia Motors is down 3.1%, while Ssangyong Motor is unchanged. Steel maker Hyundai Steel is losing 2.91% and Posco is declining 1.36%.

In the oil sector, SK Holdings is declining 1.19%, S-Oil is edging down 0.3% and energy stock KEPCO is losing 1.42%.

SK Energy said Tuesday that its net profit for fiscal year 2009 declined 22% on weaker margins in its petroleum business and lower prices for the company’s oil products due to the fall in crude oil prices. The company earned 690.4 billion won in 2009, compared with net profit of 888.1 billion won in 2008.

Among banks, Korea Exchange Bank is gaining 1.13%, Woori Finance is up 1.72%, Shinhan Financial is adding 0.62% and KB Financial, the holding firm of Kookmin Bank, is gaining 0.76%.

Telecom stock SK Telecom is adding 0.28% and KT Corp. is gaining 1.60%.

The New Zealand stock market opened modestly higher on Tuesday, taking cues from Wall Street where stocks closed higher overnight despite some discouraging economic news. The U.S. stocks rebounded on Monday after suffering steep losses last week in the wake of proposed new banking rules from President Barack Obama.

The benchmark NZX 50 index was adding 7.09 points or 0.22% to 3,195.75 shortly after the market opened on Tuesday. Meanwhile, the broader NZX All Capital index was advancing 7.10 points or 0.22% to 3,217.41.

The market closed marginally lower on Monday, continuing to suffer negative affects of U.S. President Barack Obama’s announced plans to clamp tight restrictions on major American banks. The NZX 50 index posted a drop of 1.8 points or 0.6% to close at 3,188.7 on Monday.

On the currency front, the New Zealand dollar was buying US$0.7144 in early trades Tuesday, after dropping to as low as US$0.7128 during the night. In comparison, the kiwi was buying US$0.7130 in late trades Monday.

In the early trading on the New Zealand stock market on Tuesday, market leader Telecom surged 2.37%, second-ranked Contact Energy remained unchanged, and Fletcher Building, the third best stock, declined 0.25%.

In the retail sector, Hallenstein Glasson jumped 2.48% and Warehouse added 1.30%, while jewelry retailer Michael Hill International and Pumpkin Patch remained unchanged. Among energy stocks, TrustPower and Vector remained unchanged in the early trading.
Among the dual-listed issues, AMP fell 1.68%, Australia and NZ Banking Corp lost 1.59%, and Westpac Bank gave up 1.81%. However, Telstra surged 2.37% . APN News & Media and Lion Nathan remained unchanged.

Among other notable stocks, Infratil added 0.61%, Nuplex collected 0.91% and New Zealand Oil & Gas advanced 0.63%. Mainfreight, Sky City, Sky Network Television and Steel & Tube Holdings remained unchanged. Fisher & Paykel Appliances climbed 3.33%, while Fisher & Paykel Healthcare remained unchanged.

Among other major markets open for trading in the region, Hong Kong’s Hang Seng Index is down 274 points or 1.33% to 20,324, Taiwan’s Weighted Index is losing 148 points or 1.88% to 7,725, Singapore’s Strait Times Index is down 46 points or 1.63% to 2,766 and China’s Shanghai Composite Index is declining 51 points or 1.65% to 3,043. Indonesia’s Jakarta Composite Index is losing 10 points or 0.39% to 2,588.

by RTT Staff Writer

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