Asian shares fell Friday, weighed by unexpectedly weak Chinese trade data

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Asian shares fell Friday, weighed by unexpectedly weak Chinese trade data, and with earnings-related losses also dragging on some markets.

Japan’s Nikkei Stock Average (TYO:JP:100000018) fell 1%, the Australian S&P/ASX 200 index (ASX:AU:XJO) traded down 0.5%, and Hong Kong’s Hang Seng Index (HSI:HK:HSI) fell 0.7%.

The Shanghai Composite Index (SHA:CN:000001) lost 0.1%, while South Korea’s Kospi (KRX:KR:SEU) traded flat.

Helping weigh on the markets were Chinese trade data released midday showing a surprise narrowing in the surplus, as both exports and imports printed well below estimates. Read more on Chinese trade data.

“The combination of weaker external demand and sluggish domestic investment suggests that the probability of a third-quarter GDP growth recovery is diminishing. We expect monetary policy to ease a bit in the near future, but its impact on the overall economy will be modest,” said Jun Ma, fixed-income strategist at Deutsche Bank.

But shares had traded mostly lower even before the downbeat data, with KGI Asia Chief Operating Officer Ben Kwong citing the outlook on monetary stimulus from European Central Bank, the Federal Reserve and the People’s Bank of China.

“I think that markets have discounted a lot of positive expectations for easing,” Kwong said. “In the absence of fresh incentives, further upside will be relatively small.”

U.S. shares put in a lackluster performance Thursday. Read more on U.S. stocks.

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Earnings news sent some firms tumbling in several major Asian share markets.

Li & Fung Ltd. (HKG:HK:494) (OTN:LFUGY) plunged 20% in Hong Kong after the export firm posted a 33% rise in first-half net profit but said its core operating profit dropped 22%, in part due to a weak performance in the U.S. Read more on Li & Fung earnings.

Japan’s Olympus Corp. (TYO:JP:7733) (OTN:OCPNF) slid 2.5% after the company late Thursday reported a more-than-threefold widening of its quarterly net loss and said it was seeking a partner to help shore up its finances.

Similarly, Tokyo-listed Trend Micro Inc. (TYO:JP:4704) dropped 9.5% after the technology services firm reported second-quarter earnings which missed estimates widely, according to CNBC.

In the banking sector, Japan’s top bank by assets Mitsubishi UFJ Financial Group Inc. (TYO:JP:8306) (NYSE:MTU) lost 2.4% after a Nikkei news report that one of its employees is under suspicion of manipulating the yen-quoted London interbank offered rate. Read more on reported MUFG Libor suspicions.

Among the Hong Kong blue chips, Internet firm Tencent Holdings Ltd. (HKG:HK:700) (OTN:TCEHY) lost 4.1% ahead of its earnings due next week, and casino operator Sands China Ltd. (HKG:HK:1928) (OTN:SCHYY) declined 3.3%.

Energy firms advanced, however, with Tokyo-traded JX Holdings Inc. (TYO:JP:5020) (OTN:JXHGF) up 1.5% after Credit Suisse hiked its rating on the stock to outperform from neutral, according to Dow Jones Newswires.

In Hong Kong, China Shenhua Energy Co. (HKG:HK:1088) (OTN:CSUAY) climbed 0.7%, while in Sydney, Linc Energy Ltd. (ASX:AU:LNC) (OTN:LNCGY) added 3.5%.

The South Korean share market was helped by an advance for LG Display Co. (NYSE:LPL) , which rallied 3%; steel maker Posco, advancing 1.1%; and car maker Hyundai Motor Co. (OTN:HYMTF) , up by 1%. – Market Watch