Tuesday 10 January, 10:00 AM GMT (Thomson Financial): Asian markets ended
lower as investors overlooked the rise in U.S. markets, instead showing
concern for weakness in the greenback against local currencies. Japan's
market fell heavily on profit taking amid concern over the strong yen,
while Hong Kong's market closed marginally higher. Meanwhile, the Korean
bourse ended lower on worries over the appreciation of the won, while
Taiwan's market softened as investors sold technology stocks. Finally, the
market in Australia closed slightly lower as energy stocks reacted
negatively to the easing of the oil price.
Tokyo's Nikkei-225 Index slumped 303.86 points or 1.85% to 16124.35, while
Hong Kong's Hang Seng Stock Index inched up 22.48 points or 0.14% to
15569.91. Korea's Kospi Index fell 12.04 points or 0.85% to 1396.29, while
Taiwan's Weighted Index weakened 34.99 points or 0.52% to 6707.40.
Australia's All Ordinaries Index eased 14.10 points or 0.30% to 4761.70.
Japan's market closed sharply lower as investors chose to lock in profits
from the recent strong performance, rather than focus on overnight
strength in the U.S. markets as the strength of the yen against the U.S.
dollar weighed on sentiment. Financial stocks fell sharply, while
exporting stocks, such as auto makers and technology companies came under
heavy selling pressure.
In the financial sector, Sumitomo Mitsui Financial Group fell heavily in
the wake of its announcement that it would issue 80,000 new shares to
strengthen its capital base in an effort to repay public funds, with
negative sentiment spreading throughout the sector as Resona Holdings and
Mitsubishi UFJ Financial also dropped heavily.
Auto makers suffered from the strength of the yen against the U.S. dollar,
which reduces the value of overseas earnings, with Toyota and Honda
leading the falls, while the maker of Subaru brand cars, Fuji Heavy
Industries also skidded. Technology stocks reacted negatively to yen
strength, with Sony and Sharp ending lower, while Matsushita also fell
despite news of it investing heavily in a new plant to make plasma
televisions. However, Toshiba jumped on a report that it expects operating
profit to jump by 30% compared to the previous year and some 30 billion
yen higher than previously forecast.
Hong Kong's market closed fractionally higher as profit taking set in late
in the session. CNOOC rose strongly after announcing that it is taking a
45% stake in a Nigerian oil field, while property stocks were mixed, with
Sun Hung Kai Properties and Hang Lung Properties rising but Cheung Kong
Holdings and Henderson Land falling. Meanwhile, banks also traded mixed,
with heavyweight HSBC Holdings ending higher, Hang Seng Bank remaining
unchanged and BOC Hong Kong closing lower.
In Korea, the key share index fell on profit taking, with the strength of
the won weighing on investor sentiment. Securities firms came under
pressure following recent strength, with Samsung Securities, Woori
Investments & Securities and Daishin Securities all dropping heavily,
while non life insurance companies were also sold, with LG Insurance and
Samsung Fire & Machine Insurance both plunging. On a brighter note,
Samsung Electronics and Hynix Semiconductor both advanced on expectations
of strong fourth quarter results and on the bright outlook.
Meanwhile, Taiwan's market ended lower as investors became concerned by
the appreciation of the local currency against the U.S. dollar and sold
off technology stocks. TSMC dropped, despite reporting record sales in
2005, with UMC coming under heavy selling pressure following the
indictment of three of its top executives for breach of trust in a case
involving assistance to a Chinese chip maker. Elsewhere, laptop computer
makers, Quanta Computer and Compal Electronics fell sharply on worries
about earnings in the wake of strength in the local currency.
Finally, the market in Australia ended lower on profit taking as falls in
the oil price hit energy stocks. Heavyweights BHP Billiton and Rio Tinto
both ended lower, while oil companies Woodside Petroleum, Santos, and Oil
Search softened, in line with the easing of the oil price. Gold miner
Newcrest Mining rose on strength in the price of the precious metal,
though Lihir Gold and Oxiana ended lower on profit taking, while financial
stocks were mixed, with Commonwealth Bank and ANZ rising but National
Australia Bank falling.
Ian.Littlewood@thomson.com; Thomson Financial
This is Thomson Financial Corporate Services Asia Market Commentary. The
information herein is believed to be true and accurate. If you have any
questions please e-mail James Sang at James.Sang@tfn.com. We take no
responsibility for inaccurate information and reserve the right to update
our reports. For more information about Thomson Financial visit us
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SOURCE Thomson Financial Corporate Group
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