Asia stocks mixed with EU, earnings in focus; Nikkei drops 0.55%

Forexpros - Asian stock markets were mixed on Wednesday, as shares in Japan were pressured following the disappointing outcome of the previous day's Franco-German summit meeting, while markets in Hong Kong and Australia were boosted by strong earnings reports.

During late Asian trade, Hong Kong's Hang Seng Index climbed 0.5%, Australia's ASX/200 Index rallied 1.3%, while Japan's Nikkei 225 Index slumped 0.55%.

German Chancellor Angela Merkel and French President Nicolas Sarkozy proposed a new council to improve the governance of the euro zone and planned to introduce a financial transaction tax in September.

But the two leaders fell short of increasing the region's bailout fund, which many feel is inadequate should the debt crisis spread to Italy, Spain or France.

They also rejected issuing euro bonds, saying that the bonds will not solve the bloc's debt issues, disappointing investors who had been anticipating such an action.

Shares in Japanese exporters with high exposure to Europe performed poorly, amid concerns over export earning prospects. Automakers Toyota and Honda dropped 1.5% and 2.5% respectively, while digital camera maker Nikon lost 1%.

Electronics giant Sony retreated 0.8% after saying it will cut the price for its PlayStation3 videogame console by up to 17% in an effort to remain competitive in the market.

Meanwhile, in Hong Kong, China Coal Energy shares surged 7.55% after reporting a 7.8% increase in profit in the six months to June.

Financials were also broadly higher, with Bank of China Hong Kong shares jumping 4.5% and HSBC Holdings up 1.2%.

In Australia, oil and gas giant Woodside Petroleum saw shares advance 1.2% after reporting better-than-expected first half earnings.

The outlook for European stock markets was downbeat. The EURO STOXX 50 futures pointed to a loss of 0.95%, France's CAC 40 futures dropped 0.5%, the FTSE 100 futures fell 0.7%, while Germany's DAX futures indicated a loss of 0.9%.

Later in the day, the euro zone was to release official data on consumer price inflation, as well as data on the region's current account.

Meanwhile, the U.S. was to publish official data on producer price inflation, as well as government data on crude oil stockpiles.

Forex News

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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