Asian Shares Down – Nikkei Is Biggest Decliner
Stocks in Japan led to declines across the region, dragged by weak oil prices and concerns about the health of the nation’s banks.
The Nikkei Stock Average closed Wednesday down 1.3% with energy, banking and export sectors leading losses. Korea’s Kospi closed down 0.5%, the Shanghai Composite Index ended 0.3% lower and Hong Kong’s Hang Seng Index was flat.
Japanese shares were also down as the Mizuho Financial Group Inc. fell 1.8%, Sumitomo Mitsui Trust Holdings Inc. ended down 2.4%, Dai-ichi Life Insurance Co. lost 2.5% and Nomura Holdings Inc. fell 2.8%.
The persistent strength of the yen has also weighed on Japanese stocks, said Linus Yip, chief strategist at First Shanghai Securities, calling the yen a “major focus for the Japanese market.” A strong yen makes Japanese exports less competitive and diminishes profits earned overseas.
The yen gained against the dollar in Asian trade Wednesday but was last trading 0.2% lower at ¥100.57 to the dollar.
The situation has been made worse by an oil-price slide in the U.S. overnight Tuesday that hit Japanese energy stocks. Saudi Arabia’s energy minister said OPEC (Organization of the Petroleum Exporting Countries) wouldn’t reach a deal to curb output during talks this week in Algiers.
However, oil prices recovered slightly in Asian trade Wednesday, with international benchmark Brent crude rising 0.4% to $46.17 a barrel.
That helped Japanese oil explorer Inpex narrow its losses. It ended down 0.4%, after being off 2.3% earlier. Japan Petroleum Exploration Co. was down 2%.