Asian markets were ending 2014 on a cautionary note on Wednesday as worries about Greece’s future in the euro zone served as an excuse to take profits on crowded trades, though Chinese stocks seemed destined for their best year in five.

The US dollar ran into selling on its recent gains, while the euro got no respite as a host of European bonds yields scored all-time lows after a shockingly sharp fall in Spanish inflation.

Trade was thinned by holidays in Japan, Thailand, South Korea and the Philippines, while many markets in Europe are either shut or finish early on Wednesday.

China's manufacturing PMI

Among the scraps of news in Asia was a final measure of December Chinese manufacturing activity from HSBC but it barely caused a ripple by coming in at 49.6, compared to the preliminary reading of 49.5.

Of the markets open, Australia and Singapore were flat for the day. MSCI’s broadest index of Asia-Pacific shares outside Japan was ending the year almost exactly where it started.

The Nikkei fared better with a rise of 7.1 per cent for 2104, thanks chiefly to the Bank of Japan’s extraordinary campaign of asset buying which lowered the yen, while fattening exporters’ profit margins.

Stand-out global perfomer

The stand-out global performer was China, where the CSI300 index of the largest listed companies in Shanghai and Shenzhen looked set to end 2014 with gains near 50 per cent, the biggest among the world’s major market.

Almost all of China’s rise came in the last couple of months, as hopes for more aggressive policy stimulus boosted banks and brokers.

Featuring on Wednesday were hefty gains for China’s biggest train makers, China CNR and CSR Corp, after the two firms confirmed a $26-billion merger.

Asia’s worst performer

Asia’s worst performer in 2014 was South Korea, where the KOSPI lost 4.8 per cent for the year.

On Wall Street, the S&P 500 eased 0.49 per cent on Tuesday but was still on track for a third straight year of double-digit returns. The Dow fell 0.31 per cent, while the Nasdaq lost 0.61 per cent.

In currencies, the dollar eased on the safe haven yen to stand at 119.41 from Tuesday’s peak of 120.69.

The euro was undermined by sliding European yields amid intense speculation the European Central Bank will have to start buying government bonds to avert deflation.

The single currency was stuck at $1.2162 having touched a 29-month trough of $1.2123.

Treasury yields

German yields hit a new record low on Tuesday, ending 2014 with their biggest annual fall in six years, while yields in Italy and Spain also reached historic lows.

Data out on Tuesday showed Spanish consumer prices fell in December at their fastest rate since July 2009, largely as a result of cheaper oil.

There was little sign as yet of an end to oil’s stunning decline after it hit lows last seen in May 2009. Brent was down 64 cents at $57.26 on Wednesday, leaving it down 48 per cent for the year, while US crude lost 47 cents to $53.65 a barrel.

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