North Korea-US tensions take Nikkei Asia300 Index down a 2nd day
HONG KONG (Nikkei Markets) -- Asian stocks outside of Japan fell for a second day as escalating tensions between the U.S. and North Korea kept investors away from risk assets.
The Nikkei Asia300 Index lost 0.9% to end at 1,281.42 points on Thursday. Heavyweight mainland lenders Industrial and Commercial Bank of China (ICBC) and China Construction Bank (CCB), along with Tencent Holdings and Samsung Electronics, contributed the most to the gauge's losses.
Safe-haven assets such as gold and the Japanese yen rose for a third day as risk sentiment remained on the back foot after North Korea said it will develop a plan by mid-August for launching missiles to fall 30 to 40 kilometers away from Guam in the Pacific Ocean. U.S. Secretary of State Rex Tillerson said Wednesday the Asian country posed no "imminent threat," several hours after President Donald Trump warned that further threats from Pyongyang would be met with "fire and fury."
"These tensions are not news to investors, as the relationship between the two countries has see-sawed for decades," Hussein Sayed, chief market strategist at FXTM, wrote in a note to clients. "Geopolitical tensions shock markets for a short time frame, until the situation settles, and if Trump scaled down his angry tweets, investors wouldn't have reacted as strongly."
South Korea's index fell 1.3%. Samsung Electronics extended Wednesday's 3% slide to shed another 0.8%. The won fell 0.6% to a four-week low against the U.S. dollar.
Hong Kong's gauge shed 1.1%, while the country index for China lost 0.9%. Nikkei's Taiwan index declined 1.1%.
Social media and gaming giant Tencent fell 1.1% as it moved away from a record high in its first fall in five days. Still, the stock is up almost 5% this week as investors bet on its first-half earnings due on Aug. 16.
Mainland lenders ICBC and CCB lost at least 1.8% each. Both banks are due to report first-half earnings at the end of August.
China Mobile advanced 2.8% after the telecommunications operator posted a 3.5% increase in the first-half net profit.
The country gauge for Malaysia lost 0.1%. Hartalega Holdings fell 1.5%, adding to a more than 3% slide on Wednesday after brokerages downgraded the glove maker on valuations. The stock remains 41% higher year-to-date.
Official data released Thursday showed Malaysia's industrial production rose a better-than-expected 4% in June from a year earlier, driven by all key sectors. The median forecast in a Nikkei Markets' poll of seven economists was for a 3.3% year-over-year increase.
Singapore's index added 0.3%. DBS Group Holdings rose 1.1%, snapping a four-day losing streak. The lender has been under pressure since releasing June quarter earnings last week, as a lack of sequential net interest margin widening left some analysts disappointed.
Raffles Medical Group fell 3%. The stock has lost 12% in August already, declining for six out of seven sessions, after reporting a marginal increase in second quarter profit and revenue on July 31.
Markets await the city-state's final second-quarter gross domestic product reading and retail sales numbers for June, due Friday. Singapore's economy grew 2.5% in the June quarter, according to the government's advance estimates released in July.
In the rest of Southeast Asia, Indonesia's index fell 0.4%, Thailand's gauge slipped 0.1%, and Vietnam's index added 0.4%. The Philippines index ended 1.1% lower. The country's central bank left its benchmark interest rate unchanged at its policy review on Thursday, as was widely expected.
India's index shed 1.3%. Tata Motors slumped 8.6% after reporting June-quarter earnings. The Indian operations of Tata Motors posted a net loss of 4.67 billion rupees ($73 million) for the period, while its British luxury unit Jaguar Land Rover, which contributes the bulk of earnings at Tata Motors, had a 55% surge in net profit during the April-June period thanks to a one-time gain due to recent changes made to its pension plans.
--Suzannah Benjamin and V. Phani Kumar