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Market Update

Shanghai, Sydney Slip After China Data; Nikkei Choppy

Asian markets were mostly lower Monday as investor confidence was weighed down by disappointing Chinese industrial activity data.

China's Shanghai Composite lost 0.7%, Australia's S&P ASX/All Ordinaries fell 1.4%while Japan's Nikkei was trading flat amid choppy trades at 12:54 p.m. Tokyo time.

Mumbai's Sensex, however, was on the upside-- adding 0.4% in early trades even as the Indian currency gained ground against the U.S. dollar.

Markets in Hong Kong remained closed for a holiday.

According to official data released in China, the country's purchasing managers' index for June came in at 50.1, in line with expectations, but below the final reading of 50.8 in May.

Meanwhile, the HSBC manufacturing PMI reading fell to 48.2 in June from 49.2 in May, indicating further signs of slowdown in China's industrial sector. A reading below 50 indicates contraction and vice versa.

The downbeat news also overshadowed some positive data coming out of Japan. The Bank of Japan's closely-watched Tankan survey showed sentiment among large manufacturers turned positive in the April-June period for the first time in almost two years.

Stocks on the Move

Overall trading in Tokyo was volatile early in the sesison, but financial stocks were steady gainers. Mitsubishi UFJ Financial added 1.6% while brokerage house Daiwa Securities rose 2.8%.

Among exporters, auto firms raced ahead. Mazda Motor Corp. accelerated more than 4% while Toyota Motor was up around 1% following the Tankan report.

In the retail segment, Aeon Co. Ltd. tacked on 2% amid buzz the retailing giant would post a record operating profit for the March-May quarter.

J.Front Retailing rallied over 2% but department store operator Takashimaya slipped 0.5% despite posting strong quarterly operating profit.

Also on the flipside, Softbank Corp. erased 0.4% as investors booked profit and amid news of a rating downgrade

In news, Lixil Group Co. announced Friday it would purchase ASD American Holding Corp. for $542 million. Shares of the Japanese firm were trading 1.3% lower at the time of writing.

In Shanghai, metal players were trading under pressure on heels of the dismal manufacturing activity reports. Baoshan Iron & Steel Co. was down 1.3% while Aluminum Corp. of China lost 0.3%.

Property stocks also moved slightly lower. Gemdale Corp. lost around a percent while Poly Real Estate Group eased 0.1%. The broader Shenzhen-listed China Vanke dropped 1.2%.

Financials added to the broad market losses. ICBC pulled back 1% while Bank of China lost 1.5%. Agricultural Bank of China retreated 0.8%.

Stocks in Sdyney posted heavy losses amid concerns about economic growth in China (its biggest export destination).

Banks were among the top losers. NAB fell 2.3%, Westpac Banking dropped 2.8% while ANZ tumbled 3.2%.

Among resources, leading miner BHP Billiton retreated 1.1% while close rival Rio Tinto also gave up around a percent. Diversified iron-ore miner Fortescue Metals Group erased 1.3%.

Other losers included Seven Group Holdings (-5%), Harvey Norman Holdings (-4%), Goodman Fielder (-2%) and Woolworths (1.9%).

In Mumbai, stocks extended gains as sentiment continued to be positive after the government last week approved a hike in natural gas prices effective 1st April next year.

Top gainers included BHEL (+2.4%), Tata Power (+2.2%), NTPC (+2.1%),  L&T (+2.0%) and Jindal Steel  (+1.7%).