Asian Markets Extend Losses On Credit Concerns, Weak Commodity Prices
The markets across Asia extended losses for the third day on Wednesday on lower commodity prices and fresh concerns about Dubai financial crisis as well as the downgrading of Greece's credit rating by Fitch. Japan's downward revision of Q3 GDP numbers also impacted market sentiment.
In Japan, the benchmark Nikkei 225 Index fell 135.75 points, or 1.3%, to 10,005, while the broader Topix index of all First Section issues declined 11.76 points, or 1.3%, to 885.
On the economic front, final report released by the Cabinet Office revealed that Japan's gross domestic product expanded by just 0.3% in the third quarter of 2009 compared to the previous three months. That was well below analyst expectations for a 0.7% quarterly increase following the 1.2% expansion in last month's preliminary report. On an annual basis, GDP was up 1.3% - again missing expectations for a 2.8% increase after the preliminary report showed a 4.8% jump.
Commodity-related stocks led the decline following weakness in commodity prices in the international market. Inpex Corp., engaged in oil production and exploration, declined 0.44%. Among other stocks, Showa Shell fell 3.47%, Nippon Oil Corp lost 2.60% and Nippon Mining Holdings slumped 3.64%.
Trading companies ended in negative territory on lower commodity prices and stronger local currency. Mitsui & Co., declined 3.29%, Mitsubishi Corp. slipped 1.57%, Toyota Tsusho Corp. fell 2.17%, Sumitomo Corp. fell 2.84% and Itochu Corp. shed 1.98%. Automotive stocks, except Suzuki Motors, ended in negative territory. Toyota Motor declined 1.33%, Honda Motor lost 2.14%, Hino Motors fell 3.80%, Isuzu Motors slumped 4.62% and Mitsubishi Motor slipped 0.74%.
Suzuki Motor announced that it is in talks with German automaker Volkswagen for a business as well as capital tie-up. Following the news, the shares of Suzuki Motor surged up 3.49%.
Banks ended in negative territory on fresh concerns about Dubai financial crisis and downgrading of Greece's credit rating. Sumitomo Mitsui Financial fell 2.66%, Resona Holdings lost 2.76%, Mizuho Financial declined 3.01% and Mitsubishi UFJ Financial slumped 5.17%.
In Australia, the benchmark S&P/ASX200 Index lost 32.70 points, or 0.70% to close at 4,638, while the All-Ordinaries Index ended at 4,653, representing a loss of 33.80 points, or 0.72%.
On the economic front, a report released by the Australian Bureau of Statistics revealed that the country recorded a seasonally adjusted trade deficit of A$2.38 billion in October, wider than economists expectation of a deficit of A$1.805 billion.
In a separate statement, the Statistics Bureau revealed that the total number of home loans declined 1.4% during October, coming in at 63,865, compared to the previous month.
Results of the Westpac-Melbourne Institute consumer sentiment index revealed that the index measuring consumer confidence in the country declined 3.8% month-on-month in December, posting a score of 113.8.
Mining and metals stocks led the decline in the market following drop in commodity prices in the international market. BHP Billiton lost 1.22%, Rio Tinto fell 1.39%, Fortescue Metals declined 1.66%, Gindalbie Metals slipped 0.53%, Iluka Resources shed 1.38% and Oz Minerals decreased 2.48%.
Gold stocks also ended weaker on lower bullion prices. Lihir Gold declined 2.38% and Newcrest Mining lost 1.62%.
Among oil stocks, Woodside Petroleum fell 2.14%, Santos lost 2.59% and Oil Search declined 1.71%. Origin Energy, however, bucked the trend and ended in positive territory with a gain of 0.38%. Mixed trading was witnessed among the retail stocks. David Jones added 0.37% and Wesfarmers advanced 0.59%. However, Harvey Norman declined 2.60%, JB Hi-Fi lost 0.39% and Woolworths fell 1.71%.
Banks ended weaker. ANZ Bank fell 1.92%, Commonwealth Bank of Australia slipped 0.43% and Westpac Banking lost 1.09%. National Australia Bank, however, bucked the trend and ended in positive territory with a gain of 0.25%.
In Hong Kong, the Hang Seng Index extended losses for the fourth consecutive session, and closed at 21,742, representing a loss of 318.76 points, or 1.44%, taking cues from Wall Street where the major averages ended lower on fresh financial concerns in Dubai, higher dollar and weaker commodity prices. Sharp downward revision in Japan's Q3 GDP numbers, profit taking and weak trading across other markets in the region also impacted market sentiment. Of the 42 components in the index, as many as 38 stocks ended in negative territory.
In South Korea, the KOSPI Index managed to end in positive territory with a gain of 6.39 points, or 0.39% at 1,634, as institutional investors shrugged off concerns about Dubai financial crisis and downgrading of Greece's sovereign credit rating by Fitch. Nor the weaker commodity prices amid strength in dollar, as well as weaker closing on Wall Street in the previous session had any major impact in trading session characterized by relatively less volumes. Select buying interest at lower levels by institutional investors led the gains among blue-chip stocks.
Heightened risk aversion among investors on account of the Dubai and Greece concerns and currency movements in the forex markets dragged the Indian market lower on Wednesday. Profit taking after a sharp spike in the previous session also contributed to the weakness. The BSE Sensex finished at 17,125, down 102 points or 0.59% and the S&P CNX Nifty fell 36 points or 0.70% to 5,112
Among other major markets in the region, China's Shanghai Composite Index fell 57.09 points, or 1.73% to close at 3,240, Singapore's Strait Times Index slipped 8.29 points, or 0.30%, to close at 2797, and Indonesia's Jakarta Composite Index edged down 2.59 points, or 0.10%, to close at 2,481. However, Taiwan's Weighted Index bucked the weak trend and ended in positive territory with a gain of 28.71 points, or 0.37%, at 7,797. |