ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon PrintIcon Twitter
Equities

Nikkei Asia300 Index declines as Tencent falls after earnings

Index gained earlier after Fed stuck to 2018 rate projections

MUMBAI (NewsRise) -- Asian stocks outside of Japan fell Thursday, as losses in heavyweight Tencent Holdings wiped off earlier gains after the U.S. Federal Reserve stuck to its interest rate projections for 2018.

The Nikkei Asia300 Index fell 0.8% to 1,452.24. Hong Kong-listed Tencent dropped 5% after reporting a lower-than-expected 51% increase in December quarter revenues. Jefferies said in a note that the revenues were 3% below consensus expectations and 6% below their own estimates, primarily on account of the quarter-on-quarter decline in online gaming revenues. The Chinese social media and mobile gaming company's net profit, which almost doubled from a year earlier, was ahead of analysts' projections.

The A300 had edged higher earlier in the day after the Fed raised rates by a quarter percentage points as expected and its dot plots suggested that it was on course to hike rates two more times this year. The total of three interest rate hikes in 2018 indicated by the dot plots was unchanged from December, providing a bit of relief to investors who had feared a quicker pace of increases. The Fed's projections for next year did move higher, as did its forecast for gross domestic product and inflation.

"The median projection for 2018 stays at three hikes, easing fears that rate hikes would be aggressively frontloaded," DBS Group Research said in a note. "Broadly, the dot plot appears to be consistent with projections for higher GDP growth and core inflation."

In response to the Fed rate increase, China's central bank raised the rate it charges banks, increasing the 7-day reverse repo by five basis points. The Hong Kong Monetary Authority raised its benchmark rate by 25 basis points. Hong Kong's monetary policy is tied to the Fed as its currency is pegged to the dollar.

In other central bank decisions, the Philippines monetary authority left interest rate unchanged, as predicted by 11 of the 17 economists polled by Bloomberg. Meanwhile, central banks of Indonesia and Taiwan expectedly maintained status quo on rates.

Hong Kong property developer Henderson Land Development ended 0.2% lower, after rising earlier in the day following a 39% increase in net profit for 2017. H-shares of Hengan International Group declined 2.9% despite the Chinese baby diaper maker reporting a 9% increase for the same period. China Mobile, which reported a 5% rise in annual net profit, closed 0.8% lower.

India's Sun Pharmaceutical Industries advanced 0.6% after it received approval from the U.S. drug regulator for a plaque psoriasis drug.

In country indexes complied by Nikkei, China tumbled 2.2%, Hong Kong slipped 0.8%, and Taiwan dropped 0.4%. South Korea edged higher by 0.2%, while India declined 0.5%.

The Nikkei Asia300 ASEAN Index of Southeast Asian companies ended 0.1% lower.

--Nimesh Vora

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Try 1 month for $0.99

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends January 31st

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to Nikkei Asia has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media

Nikkei Asian Review, now known as Nikkei Asia, will be the voice of the Asian Century.

Celebrate our next chapter
Free access for everyone - Sep. 30

Find out more