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A Mixed Day For Asian Shares As Markets Try to Find Direction

Trading in Asian stocks was mixed on Tuesday. Shares in China, South Korea and Australia lost ground while equities in Japan and Taiwan closed higher. Investors appeared cautious in their trading as second quarter earnings season sets in.

What happened in Japan?

Shares in Tokyo closed higher on Tuesday with the Nikkei 225 (INDEXNIKKEI:NI225) gaining 1.37% at closing bell. Paper & Pulp, Transportation Equipment and Services sectors drove Japanese shares higher.

But messaging app Line is beginning to run into turbulence only days after its much-hyped IPO. Shares of Line declined 8.2% on Tuesday, which left the stock sitting 19% below its Friday opening price, but 21% above the IPO price.

Trading in Line shares appeared to have been affected by investor concern over the company’s ability to generate cash in an increasingly tightening economic environment. Those worries could fizzle out if the Bank of Japan moves quickly to roll out more easing policies to jump-start economic growth. Some economists are speculating that Japan is moving closer to a ‘helicopter money’ kind of easing where the central bank will directly foot government bills.

USDJPY declined 0.26% to 105.88. A stronger yen complicates the picture of Japanese monetary regulators as it proves that moves to devaluate the currency and set interest rates low fell flat.

Taiwanese shares closed higher on Tuesday with the Glass, Auto and Hotel sectors leading the gains. At the end of the day, Taiwan Weighted was up 0.30% to touch a new one-year high.

In Indonesia, the IDX Composite Index rose 0.88% on a day that saw Basic Industry, Financials and Miscellaneous Industry sectors lead Jakarta stocks higher.

Investors exit Chinese stocks

Investors lost some love for Chinese shares as the Shanghai Composite Index pulled back 0.2% and the smaller Hang Seng (INDEXHANGSENG:HSI) declined 0.6%. It was the same in South Korea as the Kospi shrank 0.2% and Australia’s S&P/ASX 200 shed 0.1%.

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