HONG KONG (MarketWatch) -- Most Asian markets were unsettled Thursday, with stocks in Japan and Hong Kong struggling to hold on to gains after a decline in Wall Street, while energy stocks declined across the region on sliding crude-oil prices.
Honda Motor Co. tumbled in Tokyo a day after it slashed the profit outlook while a strengthened yen hurt other exporters such as Canon Inc.
In Sydney, Commonwealth Bank of Australia shares plummeted as trading resumed after the bank finalized a A$2 billion ($1.4 billion) capital raising plan and after CBA said its loan impairment charges were expected to be higher than analyst estimates.
Chinese property stocks advanced in Hong Kong after Beijing announced measures to stimulate demand for homes Wednesday, but shares of some Hong Kong developers declined as banks held on to their interest rates in spite of a one percentage-point reduction by the Hong Kong Monetary Authority in its key interest rate.
After changing their direction at least once during the session, Japan's Nikkei 225 Average recently rose 0.2% to 8,627.61, while the Topix index fell 0.2% to 836.76.
In Hong Kong, the Hang Seng Index fell 0.5% to 15,385.64, after rising for three straight sessions, while the Hang Seng China Enterprises Index rose 0.4% to 8,407.96.
On mainland China, the Shanghai Composite Index slipped 0.7% to 1,963.68, led by financial, airline and resource stocks.
Merrill Lynch wrote in a report that Beijing's decision to build 7.5 million economic housing units in urban areas and 2.5 million units in the rural areas, removal of transaction tax on properties held for two years or more, and allowing the purchase of a second home at low interest rates were "a major move in stimulating the property market."
"These policies should be positive for demand on construction materials such as steel and cement. Real estate investment makes up 9.2% of China's gross domestic product, so [the policy supports] our call for an 8% GDP growth rate in 2009," wrote Merrill economists Ting Lu and T.J. Bond.
Australia's S&P/ASX 200 fell 0.2% to 3,562.10 and New Zealand's NZX 50 index added 0.5% to 2,709.19, erasing early losses.
South Korea's Kospi advanced 0.5% to 1,175.78, Taiwan's Taiex inched up 0.1% to 4,652.22 and Singapore's Straits Times Index rose 0.1% to 1,781.18, also reversing early declines.
Regional detail
In Hong Kong, shares of Cheung Kong (Holdings) declined 1.6% and Henderson Land Development Co. ) fell 3%, giving up some of their recent gains, after local lenders failed to cut interest rates, as some expected.
"This is a commercial decision. The banks want to maintain their interest income more steadily. If they lower interest rates, they could be hit hard," said Alex Tang, head of research at Core Pacific Yamaichi International.
Shares of Chinese property companies gained, with Country Garden Holdings Co. (HK:2007: news , chart , profile ) rising 3.6% and Guangzhou R&F Properties Co. (HK:2777: news , chart , profile ) soaring 9.6%.
In Tokyo, shares of Canon Inc. fell 2.7% and Nintendo Co. gave up 1.3%, as the U.S. dollar stayed well below the 90 yen level.
In Asian currency trading, the U.S. dollar changed hands for 87.62 yen, compared with 87.95 yen Wednesday and 90.09 yen Tuesday.
Shares of Honda dropped 4.1% in Tokyo after the company Wednesday cut its net profit outlook for the fiscal year ending March 31 by 62% and postponed the opening of a new plant in Japan, as auto sales slumped and a stronger Japanese currency impacted repatriated profits. See full story.
Banking and property shares gained, however, with Mitsubishi UFJ Financial Group rising 1.9% and Sumitomo Mitsui Financial Group
