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A day after a U.S.-Japan trade deal sparked optimism, Japanese stocks were down early Friday, weighed by declines in financial and utility stocks. Most other stock markets in Asia were following the Nikkei’s lead, with drops near 1.1%.
Many stocks in the Nikkei Stock Average NIK, -1.22% also go ex-dividend today, which is accounting for a good portion of the index’s decline, according to analysts. Kansai Electric Power is down 4.5% 9503, -4.71% and Sumitomo Mitsui Financial Group SMFG, -0.14% is 1.9% lower. Meanwhile, Japan Display 6740, -8.96% is down 11.9% after it said a key investor wanted to pull out of the bailout plan.
China’s industrial profits dropped 2% in August from a year earlier, after rising 2.6% in July, the National Bureau of Statistics of China said Friday. Disruptions from strong storms last month also contributed to it, Zhu Hong, an economist with the bureau, said in a statement. For the first eight months, industrial profits declined 1.7% on year, the bureau said.
China’s producer prices fell further into deflation last month, piling pressure on manufacturers that had been struggling with the prolonged trade war between China and the U.S., official data showed earlier. Meanwhile, value-added industrial output grew at the slowest pace in more than a decade, underscoring sluggish demand and soft business confidence, the bureau said.
Chinese stocks 399106, +0.99% SHCOMP, +0.07% were faring better than most others in the region, but were still down about 0.1%.
LG Innotek, a South Korean camera-module maker for Apple, may report stronger-than-expected earnings this year partly due to solid demand for the latest iPhone 11 models, Kiwoom Securities says. It expects LG Innotek to enjoy brisk demand for not just iPhone camera modules but also other parts such as printed circuit boards. Kiwoom raised the target price for the stock by 6.7% to KRW160,000. The brokerage keeps LG Innotek at buy, and revises up its operating-profit estimates by 16.7% for 3Q and 11.8% for FY 2019. The stock is up 0.9% at KRW115,000.
South Korea’s benchmark Kospi 180721, -1.08% is 0.6% lower in early trades, dragged down by large-cap technology shares. Despite renewed hopes for a U.S.-China trade deal, U.S. political uncertainty caused by an impeachment inquiry into President Trump weighs on investor sentiment, which could prompt profit-taking on recent gains, a KB Securities analyst says. Tech giant Samsung Electronics 005930, -0.91% and chip maker SK Hynix are down 1.5% and 2.6%, respectively. Car maker Hyundai Motor 005380, -0.75% is flat while Kia Motors 000270, +0.22% is up 0.7%.
There hasn’t been much for investors in Australia-listed telecommunications-infrastructure provider Superloop SLC, +2.54% to cheer this year, with the stock down around 50% from May highs. Yet Morgan Stanley thinks that could be about to change, tipping the share price to rise over the next two months and ascribing a more than 80% chance of this scenario happening. “This is because the company has been de-risked,” the investment bank says, noting Superloop lowered its earnings expectations at its annual result in August. Superloop expects Ebitda of A$14 million-A$16 million in FY 2020 while management has also repaired its balance sheet, significantly reducing debt levels.
Australia’s main stock index XJO, +0.38% was was off 1.% early Friday.
Malaysian stocks are lower with the Kuala Lumpur Composite Index FBMKLCI, -0.38% down 0.15% at 1590.58 after FTSE Russell retains Malaysia on its fixed-income watch list. Trading sentiment is likely to remain tepid following FTSE Russell’s move coupled with Wall Street volatility overnight, Hong Leong Investment Bank says. It expects KLCI to engage in sideways trading around the 1581-1595 range. Caution is expected ahead of the crucial U.S.-China trade talks and Malaysia’s national budget for 2020 in October, it says. Early index losers include gasoline stations operator Petronas Dagangan.
This story was compiled from Dow Jones Newswires reports.