Asian Shares Mixed; Australia Lower on Oil Volatility -- 2nd Update

By Chao Deng And Daniel Inman 

Stocks in Australia were under pressure from a volatile oil market Wednesday, while China shares finished mixed as investors weighed hopes for further monetary easing versus worries over Greece's debt situation.

Australia's S&P/ASX 200 closed 0.5% lower at 5769.1, after oil prices tumbled overnight on worries that swelling global oil inventories would keep prices subdued over the next few months. U.S. oil prices rose 0.7% to $50.40 a barrel in Asia trade, after sliding 5.4% on Tuesday.

Late Tuesday, the American Petroleum Institute reported a smaller-than-expected 1.6 million barrel build in crude stocks in the U.S. tied to a drop in imports for the week ended Feb. 6, according to Citi.

In Australia, mining company BHP Billiton, also a large oil producer, lost 1.3% to A$30.97. Oil Search fell 2.6% to A$8.01. Woodside Petroleum slid 3.0% to A$34.16 and Santos was down 3.3% at A$7.71. The U.S. Energy Department will release its definitive stockpile data later Wednesday.

Elsewhere, the Hang Seng was down 0.9% at 24315.02, with gains capped by the continuing debacle between Greece and its international creditors. While investors say they think Greece's problems are contained, the standoff is pushing the country closer to default and leaving the eurozone.

But the Shanghai Composite Index added 0.5% to 3157.70, on expectations that the growing risk of a deflationary spiral in China would encourage the country's central bank to ease monetary policy further.

Haitong International expects three or four cuts to the reserve requirement ratio this year and one or two interest-rate cuts. The People's Bank of China late Tuesday released its fourth-quarter monetary-policy report, saying that it would continue with prudent monetary policy and create what it described as "neutral and appropriate monetary conditions."

China Railway Group was in focus, with the stock up 2.2%, after the company said it would raise up to 12 billion yuan via a private placement.

Fast-food chain Domino's Pizza Enterprises stood out as Wednesday's best-performing stock, skyrocketing 21% to A$33.00, after the company posted a 67% jump in first-half profit and upgraded its full-year earnings guidance.

Markets in Japan are closed for a national holiday. Malaysian stocks were down 0.7% at 1798.95 and the Philippines was off 0.5% at 7687.42.

--Vera Sprothen contributed to this article.

Write to Chao Deng at [e-mail]

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