Asia stocks swing from gains to losses with U.S. economy in focus

Investing.com - Asian stock markets swung between small gains and losses on Thursday, as investors were hesitant to extend a recent rally that took regional indices to multi-year highs amid concerns over the U.S. economy.

During late Asian trade, Hong Kong's Hang Seng Index fell 0.4%, Australia’s ASX/200 Index ended down 0.4%, while Japan’s Nikkei 225 Index closed up 0.2%.

U.S. equities retreated from five-year highs on Wednesday after data showed that the U.S. economy contracted unexpectedly in the three months to December.

Meanwhile, in a statement released after a two-day policy meeting, the Federal Reserve said that the economy had "paused in recent months". The central bank said that while it was taking no new action, it would keep purchasing USD85 billion of bonds per month.

In Tokyo, the Nikkei edged up to a fresh 33-month high, boosted by strong gains in the banking sector.

Sumitomo Mitsui Financial Group saw shares jump 5.1% after the megabank reported a 34% increase in net profit for the April-December period.

The strong results boosted other shares in the sector, with Mitsubishi UFJ Financial Group and Mizuho Financial Group adding 3.6% and 2.8% respectively, while investment firm Nomura Holdings gained 2.1% ahead of the release of its earnings report later in the day.  

The Nikkei ended January with a strong gain of 7.2%, marking the best January in 15 years.

The Nikkei has rallied almost 26% since mid-November, when current Prime Minister Shinzo Abe began calling for more aggressive monetary easing from the Bank of Japan.

Elsewhere, in Hong Kong, the Hang Seng eased off the highest level since May 2011, after a number of companies warned of profit declines.

Angang Steel lost 2.5% after it warned of a heavier loss in 2012 than in the previous year. The downbeat outlook led JP Morgan to downgrade the stock to ‘neutral’.

Oil and gas giant CNOOC saw shares drop 2.75% after issuing a below-forecast production estimate for 2013.

Hong Kong’s blue-chip exporters also contributed to losses, with clothing retailer Esprit Holdings down 1.3% and Li & Fung retreating 3.5%, while footwear major Belle International Holdings slumped 2.6%.

Meanwhile, in Australia, the benchmark ASX/200 Index came under pressure from some mild profit taking after the index rose to a 21-month high on Wednesday.

Losses were limited as sentiment continued to be supported by expectations the Reserve Bank of Australia will cut interest rates in the near-term.

Shares in Whitehaven Coal tumbled 5.5% after warning that it expects profit for its fiscal first half to be weighed by weakness in the coal markets and a high currency.

Looking ahead, European stock market futures pointed to a steady open, after the Federal Reserve reaffirmed its commitment to maintaining its easing program at the outcome of its latest policy meeting.

The EURO STOXX 50 futures pointed to a loss of 0.1% at the open, France’s CAC 40 futures were flat, London’s FTSE 100 futures dipped 0.1%, while Germany's DAX futures pointed to a flat open.  

Germany was to publish preliminary data on consumer inflation and the change in the number of unemployed later in the session, while the U.S. was to release the weekly government report on initial jobless claims.