Asian markets held steady early Wednesday, as investors appear
to take in stride Greece's missed loan payment and await a raft of
factory data from across the region.
Global markets stabilized even as Greece ended up defaulting on
its €1.55 billion loan ($1.73 billion) to the International
Monetary Fund, with creditors rejecting a last-ditch effort to buy
more time. The euro weakened in early Asia trade, down 0.1% at
$1.1130.
"The default itself had been expected from last weekend and
therefore should not result in any new shock to the stock market,"
says Hideyuki Ishiguro, strategist at Okasan Securities. "Investors
remain wary of taking on any new risk, however, and that should
limit any gains today until Sunday's Greek referendum, on whether
or not to accept conditions for another bailout, is done."
In Japan, the Nikkei 225 Stock Average rose 0.2% after the Bank
of Japan's quarterly Tankan survey showed improving confidence
among big manufacturers in the second quarter.
Elsewhere, investors await manufacturing-sector data from a
number of countries, including South Korea and Indonesia, as well
as a private-sector and official gauge from China. Exports from the
region have been dismal in recent months amid China's slowdown, the
U.S.'s patchy demand and Europe's fragile recovery.
"China's official PMI is likely to inch higher, consistent with
a near-term stabilization in growth," analysts from Socié té Gé né
rale wrote in a research report.
But Chinese markets could come under pressure again following
the Shanghai Composite Index's rebound of 5.5% on Tuesday, when a
group of China's biggest asset managers said they saw buying
opportunities after the recent selloff.
Analysts say margin calls, which spurred massive selloffs
recently—helping drive Chinese markets into bear territory, or a
fall of 20% from a high—may continue. Margin calls occur when
investors are forced to stump up cash borrowed from brokers or
forced to sell their holdings because of accumulating losses on
investments.
"We don't think that the deleveraging process in the stock
market has run its course and the market may stay volatile in
coming weeks," analysts from Bank of America Merrill Lynch. "Longer
term, the psychological damage from the two-week long sharp market
decline may linger for a while. This means that any market rebound
will unlikely be strong in our view."
South Korea's KOSPI Composite was flat while Australia's
S&P/ASX 200 rose 0.8%. Hong Kong's market is closed for a
holiday.
--Bradford Frischkorn contributed to this article.
Write to Gregor Stuart Hunter at gregor.hunter@wsj.com
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