Stocks rise as shares favoured by insurers rebound

SHANGHAI: China stocks erased early losses and eked out a gain on Monday, after some shares favored by insurers rebounded, offsetting the weakness in resources pulled lower by falls in commodity prices.
The CSI300 index rose 0.4 per cent, to 3,322.26 points, while the Shanghai Composite Index gained 0.4 per cent, to 3,122.09 points. Shares particularly favoured by insurers rebounded from sharp declines caused by regulators’ stricter restrictions. Index heavyweight China Vanke Co Ltd, Gree Electric Appliance, and China State Construction Engineering all rose.
Sector performance on the mainland was mixed.
Raw material stocks were the worst performer, with an index tracking the sector down more than 0.8 per cent at the close, as the futures price of rebar lost around 3 per cent.
Trading volume in Shanghai hit a nearly two-month low, with some investors unwilling to buy risky assets as year-end approaches.
Tokyo stocks opened flat on Monday in quiet holiday trading following a three-day weekend, as investors cashed in on recent rallies.
Tokyo’s benchmark Nikkei 225 index, which closed on Friday for a national holiday, fell 0.09 per cent, or 16.89 points, to 19,410.78 in the first few minutes of trading. The broader Topix index of all first-section issues was down 0.19 per cent, or 2.92 points, at 1,540.90.
“Selective shares are facing profit-taking following the recent gains, as many investors are on the sidelines in a holiday mood, looking to fresh factors to trade,” said Shinichi Yamamoto, broker at Okasan Securities in Tokyo.
“It may take some time for the Nikkei index to reach the 20,000 mark, which is expected to be realised early next year when foreign investors are to fully return to the market,” Yamamoto said.
Indian shares fell to 7-month low on worries over capital gains tax. The NSE Nifty fell about 1 per cent on Monday to a seven-month low, erasing its gain for the year, as investors fretted that the government may impose long-term capital gains tax.
Prime Minister Narendra Modi said on Saturday that people in financial markets must make a “fair contribution” to nation building, comments that were seen as setting up the prospect of higher taxes for investors.
However, Finance Minister Arun Jaitley clarified on Sunday that the government did not plan to impose long-term capital gains tax, though that was not enough to prevent selling on Monday.
Indian shares were headed for an eighth session of declines in nine amid worries about outflows from emerging markets to the United States and continued concerns about India’s move to ban higher-value currency notes.
“It (reaction to PM’s comments) is a knee-jerk reaction,” said Gaurang Shah, vice president, Geojit BNP Paribas.
“The fact that we have broken certain levels since Brexit day low, could be spooking markets further.”
The Nifty fell as much as 1.15 per cent to 7,893.80, its lowest since May 25. It has erased its gain for the year and was last down about 0.5 per cent for the year.
The index was down 0.97 per cent at 7,908.45 as of 06:21 GMT on Monday.
The benchmark Sensex was 0.87 per cent lower at 25,814.75 after falling as much as 1.1 per cent to its lowest since November 21 earlier in the session.
In another sign of nerves in markets, the NSE’s India Volatility index surged 8.3 per cent.
Thai shares were headed for a second straight session of gains on Monday on robust November trade data showing customs-cleared exports jumped 10.2 per cent, the highest per centage rise for a month since February.
The jump in exports, which came on the back of higher demand from major markets, was markedly higher than the 1.55 per cent rise forecast in a Reuters poll of economists.
Thailand’s benchmark stock index saw broad-based gains and was up 0.4 per cent as of 04:36 GMT, mainly led by industrial, consumer and financial stocks.
The data from the commerce ministry also showed a 3 per cent rise in November imports. Economists had expected a fall of 1.05 per cent.
The November figures produced a trade surplus of $1.54 billion, triple the expectation. — Reuters

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