Asian equities were mixed on Thursday as Chinese market volatility offset optimism over the Greek parliament's approval of the new bailout agreement.
Lawmakers in Athens finally passed strict austerity measures needed to secure a debt deal from its creditors early Thursday morning local time, two hours after the official deadline. However, politicians from within Prime Minister Alexis Tsipras' ruling Syrzia party opposed the conditions outlined in Monday's deal, which include tax increases and spending cuts, sparking concerns of internal political strife. The vote comes ahead of Greek payment due to the European Central Bank (ECB) on Monday.
An ECB rates decision is due on Thursday, with President Mario Draghi likely to face questions on a decision on Emergency Liquidity Assistance (ELA) for Greece. The ELA is a program of emergency loans for Greek lenders to keep them solvent and now that the Greek parliament has approved the necessary reforms, the central bank is widely expected to increase funding.
In the U.S., Federal Reserve Chair Janet Yellen kicked off her two-day testimony before Congress on Wednesday, saying that a decision to hike interest rates would not mean the economy was in trouble. She reiterated last Friday's statement that the central bank is on pace to raise rates this year if the economy evolves as expected, adding that unemployment should decline but inflation remains below the Fed's target.
Shanghai down 2 percent
China's benchmark Shanghai Composite extended losses into a second day after closing down 3 percent on Wednesday despite strong second quarter gross domestic product data, triggering worries whether the recent government-engineered rebound has run its course. The benchmark index rallied 6 percent last week but snapped a three-day rally on Tuesday.
Elsewhere, the Shenzhen Composite lost more than 3 percent while the CSI 3000—a benchmark tracking blue-chip stocks listed in Shanghai and Shenzhen—eased 2 percent. The mood remains tense on news that key future contracts, especially the CSI 3000, are priced at a discount to current market levels, indicating that investors will need to continue selling or face losses, Reuters reported.
Minor banks like Minsheng Bank and Merchants Bank saw 1 percent losses across the board, while railway firms China Railway Construction and CSR Corp tanked 5 and 3 percent, respectively.
Hong Kong stocks meanwhile eased nearly 1 percent, with lozenges maker Golden Throat surging 6 percent in its market debut.
Nikkei 0.3 percent higher
Japan's benchmark Nikkei index climbed for a fourth day, rising to a new two-week high, as investors cheered a weaker currency. The yen weakened to a new three-week low of 123.97 per dollar overnight and hovered near that level in early trade.
Defense-related stocks were in focus after lawmakers approved a new security bill that could allow Japanese troops to fight abroad for the first time since World War II. Fuji Heavy led gains by 1 percent while Kawasaki Heavy Industries added 0.5 percent.
Toshiba lost more than 2 percent on reports that the consumer electronics firm is facing $3 billion in charges related to an ongoing accounting probe, a day after CEO Hisao Tanaka and several key board members announced their resignation.
ASX up 0.8 percent
Australian shares hit a new three-week peak above 5,600 points, higher for a third session, as resource companies released a slew of quarterly production reports.
Mining heavyweight Rio Tinto erased early gains to dip 0.4 percent after announcing a 9 percent annual rise in second quarter iron ore production.
Woodside Petroleum lost 1 percent following a 15 percent drop in second quarter output while Whitehaven Coal lost more than 4 percent after posting a 66 percent annual surge in fourth quarter output.
Kospi flat
South Korea's benchmark Kospi index was little changed after closing at its highest level since July 3 on Wednesday.
Samsung C&T and Cheil Industries gained 2 and 3 percent, respectively, ahead of Friday's shareholders vote on a controversial planned merger between the two Samsung units. KTB Asset Management announced on Thursday that it is collectively voting its Samsung C&T shares in favor of Cheil's takeover offer.
Steelmaker Posco tumbled 3 percent after reporting a 18.2 percent annual slump in second quarter operating profit.
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