--China factory report shows signs of weakness
--Hong Kong, China stocks flat
--Sony tumbles 12% in Tokyo
Stocks in Asia were mostly lower Friday after an official gauge
of last month's Chinese factory activity showed signs of
weakness.
China's manufacturing Purchasing Managers Index rose to 51.4 in
October from 51.1 in September, indicating expansion and edging
past economist expectations. A closer look at the data, however,
showed a sizeable gap between large and small manufacturers, with
the latter reporting a contraction in activity for the month.
"Although the PMI rose in October for the fourth consecutive
month, the momentum driving the increase is unbalanced," said Zhao
Qinghe, a spokesman for China's National Bureau of Statistics.
Pressure is rising on China to show that it can maintain a
recent stabilization of economic growth after a worrying slowdown
in the first half of the year.
Stocks on Hong Kong's benchmark Hang Seng Index and China's
Shanghai Composite were flat in midday trade. In Sydney, the
S&P/ASX 200 fell 0.2%.
South Korea was a bright spot in the region after the country
reported a stronger-than-expected 7.3% rise in exports last month.
Economists polled by The Wall Street Journal on average expected a
4.5% rise. Imports rose 5.1%, also more than expected.
Investors have flocked to South Korean stocks since late summer,
attracted by the country's strong finances and stable currency. The
benchmark Kospi index rose 0.3% Friday.
In Japan, the Nikkei 225 index reversed earlier gains, falling
1.1% as the yen firmed against the U.S. dollar. The Japanese
currency recently was at Y97.95 versus Y98.36 late Thursday in New
York.
Technology earnings were on the radar in Tokyo. Sony Corp. (SNE)
shares slid 12% after the company reported a wider loss for the
September quarter and slashed its profit forecast for the year by
40%.
Pointing in the other direction, SoftBank Corp. (9984.TO) shares
rose 2% after the telecom company reported a 44% leap in quarterly
profit, helped by strong demand for Apple Inc. (AAPL) iPhones sold
by its mobile unit in Japan.
"Clearly the earnings picture is a compelling one, but the lack
of clarity in government policy, especially [Japanese] Prime
Minister Abe's "Third Arrow" of structural reforms, seems to be an
inhibitor to foreign investor interest," said CLSA equity
strategist Nicholas Smith.
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