Asian shares mixed as Ukraine tensions trump US data
While the rise in geopolitical uncertainty prompted investors to buy lower-risk assets such as the yen, despite disappointing economic figures out of Tokyo, comments from Russian President Vladimir Putin helped to soothe some fears.
Tokyo slipped 0.23%, or 35.27 points, to finish at 15,424.59. Seoul shed 0.35%, or 7.22 points, to 2,068.54, while Sydney was flat, edging up 1.49 points to 5,625.9.
Shanghai added 0.97%, or 21.38 points, to 2,217.20 and Hong Kong was flat, edging up 1.06 points to 24,742.06.
After enjoying a rally over the past few weeks, investors were spooked by claims that Russian forces were inside Ukraine helping support pro-Kremlin separatists who have been fighting against Kiev's rule since April.
North Atlantic Treaty Organization (NATO) said at least 1,000 Russian troops were on the ground in the country, fuelling worries of a war.
Moscow denies the accusations but US President Barack Obama said it was "plain for the world to see" that Russian forces were fighting in Ukraine. He and German Chancellor Angela Merkel warned the actions "cannot remain without consequences," raising the prospect of even more sanctions against Moscow.
However, Putin called on separatists in Ukraine to allow Ukrainian troops out of the rebel-held town of Novoazovsk, easing some tensions.
The developments overshadowed news from the Commerce Department that the US economy expanded at a 4.2% annual rate in April-June, revising upward its previous 4% estimate.
On Wall Street the S&P 500, which ended above 2,000 for the first time this week, pulled back from August 27's record close, shedding 0.17%. The Dow lost 0.25% and the NASDAQ dropped 0.26%.
Currency dealers shifted away from their recent positive positions, moving back into the yen, which is considered a safe option in times of uncertainty.
The dollar fetched 103.79 yen in Tokyo trade, coming off earlier lows, thanks to Putin's comments as well as buying by Japanese importers before month's end.
While it is a touch up from the 103.75 yen seen late in New York, it is still well off the 7-month high of 104.20 yen seen earlier in the week. The euro bought $1.3173 and 136.74 yen, compared with $1.3181 and 136.75 yen in New York.
The Japanese unit's gains came despite official figures showing household spending sank more than expected in July while industrial production was stagnant.
The data come after a bigger-than-expected contraction in the economy in April-June as an April sales tax hike bites into the country's recovery.
While inflation came in as forecast, analysts said the results will add pressure on the Bank of Japan to unveil fresh monetary easing measures to kickstart economic growth.
On oil markets, US benchmark West Texas Intermediate for October delivery was up $0.32 at $94.87 while Brent crude for October advanced $0.35 to $102.81 in afternoon trade.
Gold traded at $1,285 an ounce at 10:54 GMT, from $1,292.23 late August 28.
In other markets:
- Bangkok rose 0.17%, or 2.58 points, to 1,561.63. Bangkok Bank dropped 0.49% to 205.00 baht, while PTT Plc was steady at 321.00 baht.
- Kuala Lumpur's main index lost 0.51%, or 9.57 points, to 1,866.11. Petronas Gas fell 0.9% to 22.80 ringgit, while plantation giant Sime Darby shed 0.1% to 9.46.
- Jakarta ended down 0.92%, or 47.62 points, at 5,136.86. Bank Negara Indonesia fell 1.83% to 5,350 rupiah, while Hero Supermarket climbed 0.39% to 2,550 rupiah.
- Singapore closed down 0.09%, or 3.13 points, to 3,327.09. Oversea-Chinese Banking Corporation rose 0.91% to SG$10.00 while agribusiness company Wilmar International gained 0.32% to SG$3.16.
- Taipei eased 0.44%, or 42.10 points, to 9,436.27. Smartphone maker HTC rose 1.48% to TW$137.5 but Taiwan Semiconductor Manufacturing Co. lost 0.8% to TW$124.
- Wellington fell 0.27%, or 14.21 points, to 5,223.30. Air New Zealand was down 0.90% at NZ$2.195 and Fletcher Building slipped 0.97% to NZ$9.20.
- Manila closed 0.70% lower, giving up 49.81 points to 7,050.89. Aboitiz Equity Ventures tumbled 2.23% to P54.75 ($1.25*) SM Investments fell 3.44% to P772 ($17.68) but Philippine Long Distance Telephone gained 1.83% to P3,450 ($79.02).
- Mumbai was closed for a public holiday. – Rappler.com
*($1 = P43.66)