Asia Pacific shares mostly traded higher on Thursday afternoon as semiconductor stocks in Japan and South Korea gained.
Mainland Chinese stocks turned positive by the afternoon, recovering from an earlier decline. The Shanghai composite added 0.29% and the Shenzhen component advanced 0.58%. The Shenzhen composite gained 0.478%.
Hong Kong's Hang Seng index gained 0.26% as shares of Chinese tech giant Tencent jumped 1.64%.
Meanwhile, the Nikkei 225 in Japan rose 0.33%, with shares of index heavyweight Softbank Group advancing about 2%. The Topix index gained 0.22%.
Australia's S&P/ASX 200 traded 0.29% higher with most sectors advancing.
In an earlier speech, Reserve Bank of Australia Governor Philip Lowe said "it is reasonable to expect an extended period of low interest rates." The Australian central bank has slashed interest rates for two months in a row, bringing it to a record low.
Overall, the MSCI Asia ex-Japan index rose 0.17%.
Semiconductors jump
In South Korea, the Kospi slipped 0.64% as shares of LG Chem plunged more than 4.5%. But shares of chipmaker SK Hynix jumped 2.45% after the company announced a reduction in chip output.
Tumbling memory chip prices led to a 89% year-on-year plunge in SK Hynix's operating profit for the reporting period, which came in at approximately 638 billion Korean won ($541.9 million), missing analysts' expectations.
Shares of rival Samsung Electronics, an industry heavyweight, gained 1.72% in afternoon trade.
The company also said Thursday its Galaxy Fold phone is set to launch in September, following an earlier delay after multiple tech reviewers reported that the device broke easily. Samsung is set to formally announce earnings on July 31.
Shares of Japanese semiconductor test equipment manufacturer Advantest soared more than 19%.
It comes as Japan introduced export restrictions on high-tech materials to South Korea that are critical in the production of semiconductors. Analysts have warned that if it remains unresolved, there could be serious consequences to the global semiconductor industry.
Companies are usually assumed to be holding around two months of inventory, SK Kim, executive director and analyst at Daiwa Securities, told CNBC's "Street Signs" on Thursday. If the trade conflict between Tokyo and Seoul extends beyond two months, the South Korean chipmakers could see a "disruption" in their supply, he added.
"It will be negative for the global IT industry," Kim said. "Korea semiconductor makers ... account for about 70% of global memory market share."
Asia-Pacific Market Indexes Chart
Overnight on Wall Street, the S&P 500 advanced 0.5% to close at a record of 3,019.56, while the Nasdaq Composite rose nearly 0.9% to end the day at 8,321.50. The Dow Jones Industrial Average, however, closed 79.22 points lower at 27,269.97.
ECB meeting awaited
Elsewhere, the European Central Bank is also set to meet on Thursday. Analysts expect that it would keep interest rates unchanged.
"The risk is the ECB loosens monetary policy tonight which can further undermine (the euro), " Joseph Capurso, senior currency strategist at Commonwealth Bank of Australia, wrote in a note.
"Our base case is for the ECB to remove its forward guidance tonight that interest rates will remain 'at their present level through the first half of 2020, and in any case for as long as necessary'," Capurso said.
Ahead of that meeting, the euro traded at $1.1137 after slipping from levels above $1.12 seen earlier in the trading week.
The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 97.723 after touching lows around 97.6 yesterday.
The Japanese yen traded at 108.15 against the dollar after seeing highs around 108.0 in the previous session, while the Australian dollar changed hands at $0.6969, slipping from levels above $0.699 yesterday.
Oil prices were higher Thursday afternoon during Asian trading hours, with the international benchmark Brent crude futures contract rising 0.17% to $63.29 per barrel. U.S. crude futures advanced 0.3% to $56.05 per barrel.
Here is a look at some of the data set to be released in the day ahead:
- Hong Kong: Trade data for June
- Japan: Nissan earnings
- South Korea: Hyundai Heavy Holdings
- European Union: European Central Bank meeting and news conference
- Turkey: Central bank meeting, its first since President Recep Tayyip Erdogan fired Murat Cetinkaya, Turkey's former central bank governor)
— Reuters and CNBC's Fred Imbert contributed to this report.
https://www.cnbc.com/2019/07/25/asia-semiconductor-stocks-ecb-currencies-in-focus.html
2019-07-24 23:53:00Z
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