Asia report: Markets weaker as PMs resign in Italy, NZ

Markets in Asia slipped in Monday, with investors focusing on two Prime Ministerial resignations in Italy and New Zealand, and the euro’s fall to a near-two year low.

Japan’s Nikkei 225 was down 0.82% at 18,274.99, with the yen 0.56% weaker at JPY 114.15 per $1.

Shares in China were lower on the launch day of the Shenzhen-Hong Kong Stock Connect, which allows mainland investors access to Hong Kong stocks through Shenzhen, and foreign traders access to Shenzhen stocks.

The Shenzhen Composite Index was off 0.78% at 2,068.17, while the Shanghai Composite Index fell 1.2% to 3,204.95.

South Korea’s Kospi finished 0.37% lower at 1,963.36, while the Hang Seng Index in Hong Kong slipped 0.26% to 22,505.55.

The major news of the day was the resignation of Italian Prime Minister Matteo Renzi, after voters in the country delivered a clear rejection to his proposed legislative reform.

“The risks by Italy's 'no' vote was about the potential for political instability and the possibility of an election in Italy rather than with any missed opportunity for long term constitutional reform,” noted CMC Markets chief market analyst Ric Spooner.

Renzi said he would meet with his cabinet on Monday, before tendering his resignation to President Sergio Mattarella.

Oil prices were lower during Asian trading, though they picked up again during early trading in Europe.

Brent crude was last up 1.22% at $55.12 per barrel, and West Texas Intermediate added 1.15% to $52.28.

Crude futures in the US were higher by 12% in the week to 2 December, however, marking the largest weekly growth in five years.

Across the pond, Brent crude futures were up 15% during the week, which was the biggest jump since 2009.

In Australia, the S&P/ASX 200 lost 0.8% to settle at 5,400.40.

New Zealand’s S&P/NZX 50 finished down 0.73% at 6,854.71 after Prime Minister John Key surprised the country with his resignation.

The right-wing National Party leader, currently in his third three-year term at the helm, said it was the “right time” to step down and give his party a chance to bed in a successor ahead of the next general election in a year’s time.

Both of the down under dollars were weaker, with the Aussie last off 0.4% at AUD 1.3456 against the greenback and the Kiwi slipping 0.64% to NZD 1.4088 per $1.