Weak US company updates weighed on investor sentiment in Japan on Wednesday while stocks in Hong Kong were boosted by some encouraging Chinese data.

Markets digested uninspiring results from big US names such as Caterpillar, DuPont and 3M. However losses in Japan were limited following upbeat Chinese manufacturing figures.

Investors cheered a preliminary report by HSBC that said Chinese manufacturing showed signs of recovery in October. The widely watched purchasing managers index (PMI) rose to 49.1 this month compared with 47.9 in September. While a figure below 50 indicates a contraction, markets were at least relieved that it shrank at a slower rate than previous months.

Shares of Sharp shrugged off an otherwise downbeat session in Tokyo after reports that it has started selling a smart phone in China. Its shares rallied over 6%.

Otherwise weak US earnings weighed on Japanese companies such as Honda Motor, which fell 2%. Gloomy Japanese earnings also sapped buyer appetite on Wednesday.

Steel maker JFE Holdings slashed its annual profit forecast by a half, citing concern about slower demand among Asian markets. Komatsu lost 2.5% while Mitsui Engineering & Shipbuilding retreated 3%.

Elsewhere Kawasaki Heavy Industries tanked 5.8% after it reduced its first half profit forecast.

Chugai Pharmaceutical fell after its earnings update and downbeat broker coverage. Nomura Securities reduced its target price on concern about sluggish sales of its main drugs.

Clothes giant Esprit plunged 12% In Hong Kong after it announced a heavily discounted rights issue after the market close on Monday.

The benchmark Nikkei 25 index closed down 59 points at 8,954 in Tokyo while the Hang Seng index closed up 66 points at 21,763 in Hong Kong.



CJ

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