November 25, 2024

You are here: Home / Archives for asian stock markets

Asian Stocks Still Shaky as Nikkei Slides 3 Percent

May 27, 2013 by Leave a Comment

Last week’s shakeout of equity, bond and currency markets was triggered by doubts over how much weakness in the yen Japanese policymakers would tolerate, concerns the U.S. Federal Reserve would reduce monetary stimulus soon, and weakness in Chinese manufacturing data.

But U.S. equities ended off their lows on Friday while U.S. 10-year Treasury yields steadied near 2 percent, suggesting to investors the dollar will resume its rally against the yen and other markets will be calmer.

The dollar was last down 0.3 percent at 101.01, not far off a two-week trough of 100.66 hit on Friday.

“It is a little bit early to get too caught up in a bearish view,” said Adrian Mowat, chief emerging markets strategist at JPMorgan, based in Hong Kong.

“Nikkei’s still above the 50-day moving average and Japan was very overbought.”

The Nikkei average dropped 7.3 percent on Thursday, its largest single-day loss since the March 2011 earthquake and tsunami. It was 3.3 percent down at 14,128.58 at midday on Monday.

MSCI’s broadest index of Asia-Pacific shares outside Japan has risen 6.5 percent in a little over a year. It edged down 0.15 percent on Monday after having skidded 2.6 percent last week to one-month lows, posting its biggest fall since May 2012.

“Last week’s shock will probably last throughout this week,” said Kenichi Hirano, a strategist at Tachibana Securities. “But the Japanese market’s fundamentals in the mid-to-long term have not changed, so there still is upside in the longer term.”

Other Asian stock markets got off to a cautious start on Monday, having suffered their biggest weekly drop in around a year as investors fretted about the possibility of the Federal Reserve dialing down its stimulus program as well as a slowing Chinese economy.

Australia’s SP/ASX 200 index slipped 0.7 percent, but South Korea’s KOSPI managed to eke out a 0.3 percent gain.

“While the market reaction looked a tad overdone, it is notable that the dichotomy between growth and equity market performance has widened over recent weeks implying that equity markets were prone to a correction,” Mitul Kotecha, head of markets research at Credit Agricole said in a note to clients.

DOLLAR BIDS TO EMERGE?

Supporting the view that the Fed may soon scale down its massive stimulus program, data on Friday showed orders for US-made durable goods rose more than expected in April, a hopeful sign that a sharp slowdown in factory output could soon run its course.

That should be music to the ears of dollar bulls. Indeed, figures on Friday showed currency speculators increased bets in favor of the greenback to the highest since at least June 2008.

The dollar index, which tracks the greenback’s performance against a currency basket, hit a three-year high last week before succumbing to a bit of pressure. It was almost flat at 83.59.

Much of the excitement in currency markets last week centered on the yen as turbulence in the Nikkei prompted investors to book profits on bearish yen positions. That saw the dollar recoil from a 4-1/2 year high of 103.74 yen set on May 22.

Still, traders expect the yen’s downtrend to remain intact after the Bank of Japan (BOJ) last month unleashed the world’s most intense burst of stimulus.

On Sunday, Bank of Japan Governor Haruhiko Kuroda said the bank will be vigilant to any signs of overheating of asset prices or excessive risk-taking by financial institutions, adding that there were no signs of that now.

Commodity markets were subdued with UK and U.S. financial markets closed on Monday for public holidays. There is also little in the way of major economic news due out of Asia.

“A calmer tone to markets ought to ensure that yen upside will be limited and dollar buyers are likely to emerge just below the dollar-yen 100 level,” Kotecha said.

“The potential for a renewed yen decline as well as some stabilization in risk appetite will give some relief to Asian currencies this week as will a relatively firm yuan.”

China’s central bank fixed the tightly managed yuan’s mid-point versus the dollar at 6.1811. It was the highest fixing since the landmark revaluation in 2005.

In the spot market, the yuan was barely changed, at 6.1316 to a dollar.

(Additional reporting by Ayai Tomisawa in Tokyo; Editing by Eric Meijer)

Article source: http://www.nytimes.com/reuters/2013/05/26/business/26reuters-markets-global.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Euro Watch: Asian Markets Drop on Latest Euro Concerns

March 18, 2013 by Leave a Comment

HONG KONG — The euro slumped Monday, and Asian stock markets sagged, amid nervousness over the euro zone debt crisis and a controversial bailout plan for Cyprus, one of the region’s smallest economies.

The plan, which would tap ordinary savers in Cyprus to share in the cost of the bailout, prompted anxious depositors to drain cash from automated teller machines in the country over the weekend, and raised concerns that bank runs could be set off elsewhere in the euro zone.

The euro reacted with a sharp fall against the dollar in Asian trading on Monday, sagging to $1.2904, down from $1.3074 at the close of play on Friday. The drop took the single European currency to its weakest level since late last year.

The Japanese yen, which tends to rise in times of uncertainly as it is seen as a relative safe haven, firmed to ¥94.66 per U.S. dollar, from about ¥96 on Friday.

Stock markets also fell sharply, with the Nikkei 225 in Tokyo and the Hang Seng in Hong Kong both down 2.1 percent by late morning.

In Australia, the S.P./ASX 200 index sagged 1.5 percent, and the Straits Times index in Singapore declined 0.8 percent.

Jeroen Dijsselbloem, the president of the group of euro area ministers, declined Saturday to rule out taxes on depositors in countries beyond Cyprus, although he said such a measure was not currently being considered.

A scheduled parliamentary vote on the plan at an emergency meeting Sunday was postponed until Monday, to give the newly elected Cypriot president, Nicos Anastasiades, a chance to brief lawmakers.

Unfortunately, the issue is not as simple as whether the Cypriot government supports the bailout, analysts at DBS in Singapore commented in a research note on Monday.

The markets, they added, are worried that the plans to force ordinary depositors to share the cost of the bailout “may send the wrong message on the safety of bank deposits in other E.U. nations, just when light appeared to be emerging at the end of the long tunnel for the peripheral nations.”

Article source: http://www.nytimes.com/2013/03/19/business/global/asian-markets-drop-on-latest-euro-concerns.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Asian Stocks Mostly Down on Europe Bank Worries

December 29, 2011 by Leave a Comment

BANGKOK (AP) — Asian stock markets were mostly lower Thursday as traders shied away from riskier assets as the year drew to a close, but hopes for a successful bond issue in Italy boosted shares in Europe.

Benchmark oil lingered above $99 per barrel while the dollar rose against the euro but fell against the yen.

European shares edged up in early trading. Britain’s FTSE 100 was marginally higher at 5,511.32. Germany’s DAX rose 0.3 percent to 5,788.06. France’s CAC-40 was 0.3 percent higher at 5,788.01. Wall Street was headed for a higher opening, with Dow Jones industrial futures gaining 0.2 percent at 12,099. Broader SP 500 futures rose 0.1 percent at 1,245.80.

Earlier in Asia, however, investors booked losses amid light trading. Japan’s Nikkei 225 index fell 0.3 percent to close at 8,398.89. Hong Kong’s Hang Seng Index closed 0.7 percent lower at 18,397.92. Australia’s SP ASX 200 fell 0.4 percent to end 4,071.10. Benchmarks in India and Singapore were also lower.

Other Asian markets eked out small gains. South Korea’s Kospi reversed earlier losses and closed marginally higher at 1,825.74. On mainland China, the benchmark Shanghai Composite Index gained 0.2 percent to end at 2,173.56, while the smaller Shenzhen Composite Index added 0.1 percent to finish at 850.94.

Investor sentiment waned in Asia hours after the European Central Bank said banks had parked $590.72 billion with it overnight Wednesday. That surpassed the record set only Monday and showed that European banks were using money lent by the ECB bank to park money there instead, rather than make loans to each other.

Francis Lun, managing director of Lyncean Holdings in Hong Kong, said the action on the part of the banks “defeated the purpose” of the ECB lending operation, which was to spur business activity.

“Investors are disappointed at the development,” Lun said. “Europe still has not found an answer on how to solve its sovereign debt crisis. There’s no solution, and they are trying cosmetic measures, which really do not address the problem.”

The development also shook confidence in the euro, which on Wednesday dropped to $1.2910 — its lowest level against the dollar in nearly a year — before recovering slightly.

Traders were closely watching for the results of an auction of longer-dated bonds by Italy later Thursday. The country held what was deemed a surprisingly successful auction of short-term bonds Wednesday, with sharply lower interest rates than at a similar auction a month before.

Meanwhile, the yen’s rise to a 10-year high against the euro put stress on Japan’s exporters. Kyodo News agency said the euro briefly fell to 100.35 yen in Tokyo, its lowest level against the Japanese currency since June 2001. Honda Motor Corp. fell 0.8 percent. Sharp Corp. shed 3.2 percent.

Commodity shares in Australia came under pressure amid worries about the state of the global economy. Gold miner Newcrest Mining Ltd. lost 3 percent. Mining giant Rio Tinto fell 0.4 percent. OZ Minerals fell 2.9 percent after the company said copper concentrate may have spilled from a derailed train.

In currency trading Thursday, the euro fell to $1.2920 from $1.2941 late Wednesday in New York. The dollar fell to 77.70 yen from 77.91 yen.

Benchmark crude for February delivery rose 28 cents to $99.65 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.98 to settle at $99.36 in New York on Wednesday.

Article source: http://www.nytimes.com/aponline/2011/12/28/business/AP-World-Markets.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Asian Markets Dip Further After Moody’s Downgrades French Banks

September 14, 2011 by Leave a Comment

Mounting worries about the exposure of the three leading French banks — Société Générale, Crédit Agricole and BNP Paribas — to Greece and their ability to handle a potential default by Greece on its debt had sent the stocks of all three financial institutions sharply lower in recent days.

On Wednesday, Moody’s downgraded its ratings for Société Générale and Crédit Agricole, citing their exposure to the Greek economy and the fragile state of bank financing markets. It kept BNP Paribas under review for a possible downgrade.

The downgrades had been widely anticipated by investors but nevertheless sparked knee-jerk drops in the euro and Asian stock markets, both of which had already been on the back foot earlier in the Asian trading day.

The euro, which had been hovering at around the mid-$1.36 level before news of the downgrades, slipped to $1.36 soon afterward.

In Japan, the Nikkei 225 index closed down 1.1 percent, the benchmark index in Australia ended 1.6 percent lower, and in Taiwan, the Taiex lost 2.2 percent.

In South Korea, where the market had been closed on Monday and Tuesday for a holiday, the Kospi dropped 3.5 percent.

The Hang Seng in Hong Kong and the Straits Times in Singapore were 1.5 percent and 0.5 percent lower, respectively, by midafternoon.

Société Générale, BNP Paribas and Crédit Agricole are considered integral actors in the French economy, lending billions of euros to businesses and individuals, and the government has said it will never let them any of them fail.

Officials have said that the French banks are adequately capitalized and currently do not need the government to provide them with additional funds.

Moreover, Société Générale announced Monday that it would raise new cash by selling assets, and BNP Paribas, the largest French bank by assets, followed suit with a similar announcement on Wednesday.

In a presentation
on its Web site, BNP said it planned to cut its risk-weighted assets by about €70 billion, or $95.7 billion, and improve its Tier 1 capital ratio — a common measure of banks’ strength — to 9 percent by the start of 2013.

Article source: http://www.nytimes.com/2011/09/15/business/daily-stock-market-activity.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Asian Stocks Rise on U.S. Spending Data

August 30, 2011 by Leave a Comment

BANGKOK (AP) — Asian stock markets advanced Tuesday as investors took heart from strong consumer spending in the U.S. and a deal to combine two major banks in debt-stricken Greece.

Oil prices hovered above $87 a barrel in Asia while the dollar weakened against the yen and the euro.

The Nikkei 225 index in Tokyo added 1.3 percent to 8,965.31 as investors seized on the positive U.S. figures and overlooked a rise in Japan’s unemployment rate.

Hong Kong’s Hang Seng gained 2.2 percent to 20,305.99 and South Korea’s Kospi was 0.8 percent higher at 1,844.37. Australia’s SP/ASX 200 rose 0.2 percent to 4,272.90.

Signs that the U.S. may be staving off another recession helped exporters that depend heavily on demand from the West. Sharp Corp. rose 2.9 percent and Panasonic Corp. was 3 percent higher. Isuzu Motor Corp. was 3.4 percent higher.

One sign of possible help on the horizon was the Federal Reserve’s decision to extend its upcoming policy meeting to two days instead of one. That raised the possibility of action, at least in the eyes of traders, to jolt the economy.

Another reason for the upbeat mood: investors were anticipating an announcement next week by President Barack Obama on a new jobs initiative.

“I think the focus is on President Obama’s speech, which is related to measures that will revive the economy,” said Kwong Man Bun, chief operating officer at KGI Securities in Hong Kong. “All this provides some of sort positive expectations for investors.”

European shares jumped Monday after Greece’s second- and third-largest lenders agreed to combine, creating the country’s largest bank. Greece’s government and central bank have been urging banks to merge, saying it would help them survive.

In the U.S. on Monday, stocks rose broadly after it became clear that Tropical Storm Irene had caused far less damage than many had feared. Insurance shares rose sharply as analysts lowered their estimates of how much damage the storm would cause.

An increase in consumer spending also helped to push stocks higher. The government reported that spending rose 0.8 percent in July. It was a sharp turnaround from June, when Americans cut spending 0.1 percent, the first decline in 20 months.

The Dow Jones industrial average rose 2.3 percent to close at 11,539.25. The Standard Poor’s 500 index rose 2.8 percent to 1,210.08. The widely used market benchmark is now up 8.1 percent since Aug. 8, when it hit low for the year because of a downgrade of the U.S. government’s credit rating. The technology-focused Nasdaq rose 3.3 percent to 2,562.11.

Despite Monday’s gains, analysts warned market sentiment will remain fragile ahead of U.S. economic indicators this week that could show slowing growth. Later Tuesday, the Consumer Confidence Index for August will be released. Then on Friday, the Labor Department will release U.S. employment data for August.

“The perception that stocks are more cheaply valued has helped to feed into appetite for equity markets. However, likely weak data in the days ahead both in the US and Europe may result in a reality check for markets,” Credit Agricole CIB said in a research note.

In currencies, the euro rose $1.4515 from $1.4505 late Monday in New York. The dollar slipped to 76.83 yen from 76.95 yen.

Benchmark oil for October delivery rose 23 cents to $87.50 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.90 to end at $87.27 per barrel on the Nymex on Monday.

In London, Brent crude for October delivery was up 26 cents to $112.14 on the ICE Futures exchange.

Article source: http://www.nytimes.com/aponline/2011/08/29/business/AP-World-Markets.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Worries About Italy’s Debt Drag Down Asian Markets

July 12, 2011 by Leave a Comment

HONG KONG — Growing nervousness about the debt crisis in Europe and the prospects for global growth continued to pummel both Asian stock markets and the euro on Tuesday as investors took refuge in what they saw as safer assets.

Stock markets across Asia dropped on Tuesday, continuing a slide that had sent equities around the world lower as investors began to fret that Italy, too, could fall victim to its combination of high debt, feeble growth and political paralysis.

Those worries, combined with the prospect of a possible stalemate in U.S. budget talks and slowing growth in China, pushed down the Dow Jones industrial index 1.2 percent on Monday.

There was no respite on Tuesday. In Japan, the Nikkei 225 index fell 1.5 percent to 9,915 points by the lunchtime break in Tokyo.

The key market indexes in Taiwan and South Korean slumped 1.9 percent, the S..P/ASX 200 index in Australia fell 1.8 percent, and in Singapore, and the Straits Times index dropped 1 percent.

In Hong Kong, the Hang Seng sagged 2.1 percent, while in mainland China, the Shanghai composite index declined 1.1 percent by late morning.

The euro, too, weakened, falling to below $1.40, its weakest since March. The European currency bought $1.397 by late morning in Asia.

The worries about Italy have further shaken already fragile global market sentiment, even though Italy retains solid debt ratings, a sound banking system and a relatively small budget deficit compared to the size of its economy. The jitters prompted the Italian stock market regulator on Monday to impose emergency rules against short selling after shares in Italian banks slumped for a fifth straight session.

The cost of insuring Italy’s sovereign debt against default surged to an all-time high, and the interest on its 10-year bond leaped to a record 5.67 percent.

“The current escalation of the euro area periphery crisis is the third period in which the problems facing Greece, Ireland and Portugal have seriously threatened more serious contagion in the euro area,” Paul Robinson, an analyst at Barclays Capital, wrote in a note.

As serious as the situation is, however, he added, “the previous episodes during which Spain and Italy were significantly affected proved temporary, and the situation facing both economies is far less serious than in Greece’s case.”

Article source: http://www.nytimes.com/2011/07/13/business/worries-about-italys-debt-drag-down-asian-markets.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,