Energy shares lead Asian markets lower on big US oil buildup

HONG KONG — Asian stock markets were mostly lower Thursday after news of a big buildup in U.S. oil stockpiles depressed crude prices and shares of energy companies.

KEEPING SCORE: Japan’s benchmark Nikkei 225 index climbed 0.2 per cent to 19,283.65 as a weaker yen lifted shares of exporters. South Korea’s Kospi dipped 0.1 per cent to 2,093.31 and Hong Kong’s Hang Seng lost 1.1 per cent to 23,522.78. The Shanghai Composite index in mainland China slid 0.8 per cent to 3,215.47 and Australia’s S&P ASX 200 shed 0.3 per cent to 5,741.20. Benchmarks in Taiwan, Singapore, Thailand and Indonesia also lost ground.

EXCESS ENERGY: Oil reserves grew by 8 million barrels last week, far more than analysts expected, according to a report by the Energy Information Administration. The news triggered a sell-off in energy-related shares and oil futures, with benchmark U.S. crude losing $2.86, or 5.4 per cent, to close at $50.28 a barrel, its biggest drop in more than a year. Prices had stabilized by early Thursday afternoon in Asia, with crude oil adding 32 cents to $50.60 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, used to price international oils, rose 43 cents to $53.54 a barrel in London.

ANALYST INSIGHT: “It’s pretty bad. A 5 per cent drop in the oil price is very significant. It even has an impact on the stock market as well,” said Margaret Yang, an analyst at CMC Markets in Singapore. “The overall performance of U.S. indices was dragged down by the energy sector and the same thing is happening” in Asia, she said. Shares of Japan Petroleum Exploration slid 1.7 per cent while PetroChina, China’s biggest oil producer, slumped 2.2 per cent and Sinopec, the country’s largest refiner, tumbled 3.3 per cent. Australia’s Woodside Petroleum lost 1.2 per cent.

CURRENCIES: The dollar rose to 114.55 yen from 114.33 yen. The euro slipped to $1.0532 from $1.0539. The greenback gained ground after an upbeat U.S. jobs report boosted expectations that the Fed will raise interest rates at its next policy meeting on March 14-15. The private ADP survey found that U.S. businesses last month added the most jobs in three years, in a healthy sign for the world’s biggest economy.

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WALL STREET: Major U.S. benchmarks fell for the third day in a row. The Standard & Poor’s 500 index dipped 0.2 per cent to 2,362.98. The Dow Jones industrial average lost 0.3 per cent to 20,855.73. The Nasdaq composite rose 0.1 per cent to 5,836.55 as health care and technology companies moved higher.

Kelvin Chan, The Associated Press