Markets mixed as Japan rises, HK drags

Resource stocks also helped to push Australian shares to an intraday record, while shares gained ground in New Zealand and the Philippines. Shares fell in China, Malaysia, Indonesia and Singapore.

In Japan, the Nikkei 225 stock index rose 0.6 percent to 16,401.72 points on the Tokyo Stock Exchange.

Analysts said the Nikkei may stay within a 16,000-16,500 band ahead of earnings reports from Japanese companies in coming weeks and the Bank of Japan’s widely watched tankan survey of corporate sentiment due on Oct. 1.

“It seems risk tolerance has returned and that is helping Japanese stocks stay supported at their current levels,” said Akio Yoshino, market economist at Societe Generale Asset Management. “But investors need to see new catalysts if they are to be persuaded there is value in Japanese shares.”

Metals companies notched up impressive gains, underpinned by higher prices for commodities. Titanium sponge producer Sumitomo Titanium Corp., for instance, rose 11 percent. Trading companies also rose on strong prices for copper, aluminum and nickel, with Mitsui & Co. gaining 3.9 percent.

Tokyo’s broader Topix index, which includes all shares on the exchange’s first section, added 0.95 percent to 1,566.83.

In Hong Kong, shares dropped for the first time in five days as airlines dragged down the market and investors locked in gains ahead of a holiday.

The blue chip Hang Seng Index fell 121.65 points, or 0.46 percent, to 26,430.29. Financial markets in Hong Kong will be closed Wednesday for a public holiday.

The benchmark index, up 32 percent since the start of the year, had hit record closes four straight days prior to Tuesday’s drop.

“It’s healthy for the market to take a breather, as many stocks have become heavily overbought,” said Kingston Lin, director of Prudential Brokerage Ltd.

Nevertheless, analysts are generally upbeat on the long-term prospects of the city’s liquidity-driven stock market, with some analysts tipping the benchmark index could reach 28,000 point before the end of the year.

“Funds will continue to pour into the market in the coming months, particularly the widely expected money coming from mainland institutional and retail investors,” said Lin.

Hong Kong-listed airlines fell sharply as expectations of an industry restructuring waned after Cathay Pacific Airways and Air China’s parent company aborted a plan to buy shares in China Eastern Airlines. Cathay Pacific fell 4.6 percent, Air China dropped 11.7 percent, China Eastern fell 14.7 percent, and China Southern Airlines slid 4.1 percent.

Bucking the downward trend, heavyweight China Mobile rose 2.5 percent to HK$121.10. During the session, it hit an intraday record of HK$125.0.

In currency dealing, the U.S. dollar was trading at 114.67 yen late afternoon, down from 114.88 yen late Monday in New York. The euro fell to US$1.4084 from US$1.4087.

Elsewhere:

JAKARTA: Indonesia’s main index sank 1 percent to 2,330.36 in moderate volume.

KUALA LUMPUR: Malaysia’s Kuala Lumpur composite index fell just 0.81 points to 1,316.43 in heavy volume of 1 billion shares.

MANILA: Philippine shares climbed for the second straight day Tuesday, lifted by gains in select blue chips. The 30-company Philippine Stock Exchange Index inched 6.22 points, or 0.2 percent, higher to 3,440.67.

SEOUL: South Korean markets are closed Monday to Wednesday for the annual autumn harvest festival. Trade will resume Thursday.

SHANGHAI: Chinese stocks fell Tuesday as all major airlines fell by the 10 percent limit after Cathay Pacific and Air China pulled back from a plan to buy a stake in Shanghai-based rival China Eastern. The benchmark Shanghai Composite Index fell 1.1 percent to 5,425.88 after hitting a fresh intraday record high of 5,509.23 early in the session. The Shenzhen Composite Index shed 0.9 percent to 1,492.53.

SINGAPORE: Singapore Straits Times Index fell 0.4 percent to close at 3,624.82.

SYDNEY: Major miners BHP Billiton and Rio Tinto drove the Australian market to a record high as traders focussed on BHP’s annual report due early Wednesday amid rumors of a significant resource upgrade. The benchmark S&P/ASX 200 close up 0.5 percent at 6483.0 after hitting a record high of 6509.6.

WELLINGTON: New Zealand shares edged slightly higher Tuesday, as investors continued to await developments on M&A prospects that have driven the market in recent sessions. The benchmark NZX 50 index rose 0.21 percent to 4,241.67.

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