Asia Roundup: Markets in the red

Asian markets were lower yesterday Friday October 26 as dealers looked ahead to the release later in the day of US economic growth figures, while Hong Kong eased on profit-taking after posting 10 straight days of gains.

Tokyo stocks ended 1.35 per cent lower on profit-taking, with selling pressure fuelled by a rebound in the yen after recent weakness.

The benchmark Nikkei 225 Index closed down 122.14 points at 8,933.06, while the broader Topix index of all first-section issues was down 1.36 percent, or 10.19 points, at 741.23.

Hirokazu Fujiki, strategist at Okasan Securities, said: “The market is now subject to negative factors as players are trying to lock in profits.”

“It’s still all about expectations for Bank of Japan easing,” Monex market analyst Toshiyuki Kanayama told Dow Jones Newswires.

“If the central bank decides to dramatically expand its asset purchases to include, for example, exchange-traded funds, which it is currently considering, the Nikkei could hit 9,300.”

Chinese shares closed down 1.68 per cent, hit by weak corporate earnings. The benchmark Shanghai Composite Index fell 35.57 points to 2,066.21.

“The third quarter earnings that have been published so far aren’t good at all, especially for the steel sector,” Amy Lin, an analyst at Capital Securities, told Dow Jones Newswires.

Sydney closed 0.84 per cent, or 38.1 points, lower at 4,472.4. Seoul lost 1.72 per cent, or 33.07 points, to 1,891.43.

SINGAPORE: SHARES closed 1.21 per cent lower on Friday, snapping a 10-day winning streak and in line with a regional sell-off ahead of the release of US growth figures later in the day.
The benchmark Hang Seng Index fell 264.66 points to 21,545.57 on turnover of HK$55.13 billion ($7.11 billion). The 10-day run was the HSI’s longest winning streak since February 2006.
The market has enjoyed huge inflows of foreign cash since the US Federal Reserve last month eased monetary policy further, which has in turn sent the local dollar to the top end of its 29-year peg with the US unit.
Dealers have also been inspired over the past week by data out of China indicating a slowdown in the world’s second biggest economy looks to be coming to an end.
However, a string of weak corporate results around the world have raised concerns about growth, and dealers decided to take some of the risk off the table ahead of US growth data later in the day.
KGI Asia Chief Operating Officer Ben Kwong said the market was “substantially overbought” and had to take a breather.
And Ample Financial analyst William Lo added: “The market needs a correction, and may fall toward 21,000 in the short run.”

KUALA LUMPUR: The FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBM KLCI), continued to close above its immediate downside support of the 1,650 level on Thursday.
SHARE prices on Bursa Malaysia mo-ved sideways to consolidate recent gains over the last four trading days.
The benchmark index inched gradually higher over the last four trading days. It hit its intra-week low of 1,658.03 on Tuesday before staging a technical rebound to its intra-week high of 1,671.89 on Thursday, giving an intra-week trading range of 13.86 points compared to last week’s trading range of 21.01 points.
The FBM KLCI’s 30 index-linked components rebounded over three of the four trading days during the week. Gainers outperformed losers by 14 to 13. The benchmark index posted a week gain of 5.54 points, or 0.33 per cent.
Among other indices, the FBM Small Cap Index rose 112.21 points, or 0.94 per cent. It continued to reflect the gradual shift in its overall trading activities towards the second and third liners. ACE Market counters continued to be well supported over the last few trading days. The FTSE Bursa Malaysia ACE Index eased 10.46 points, or 0.24 per cent, to the 4,272.33 level on Thursday.

In other markets:

* Taipei fell 1.76 per cent, or 128.02 points, to 7,134.06.

* Bangkok closed down 1.20 per cent or 15.58 points to 1,281.81.

* Mumbai fell 0.71 per cent or 133.29 points to 18,625.34.
Singapore, Jakarta and Manila were all closed for public holidays.

VIETNAM: Vietnamese shares closed mixed today with draining liquidity as investors were in the wait and see mood.
The benchmark VN Index gained 1.78 points or 0.46% to 391.7. Volume fell 47% to 22.9 million shares worth of VND292.55 billion.
Today’s market breadth turned positive on the primary bourse where 104 stocks advanced, 96 declined, 80 closed unchanged.
The VN30 added 2.23 points or 0.48%, to 462.16. Among its 30 members 14 gained, 9 lost the ground and 7 unchanged.
On the Hanoi Stock Exchange, the HNX lost 0.09 point or 0.17% to 53.79.
Trading volume rose 69.2% to 37.1 million shares worth VND229 billion.
The market breadth turned positive where 111 rallied, 64 declined, 82 closed unmoved, the rest untraded.
The HNX30 lost 0.41 point or 0.41% to 99.34. Of its 30 members, 13 rallied, 4 declined, 12 closed unmoved.

EUROPE: European shares turned flat yesterday, erasing earlier losses, after data showed US economic growth picked up more than expected in the third quarter.
By 1238 GMT, the FTSEurofirst 300 was flat at 1096.60, having traded as low as 1,087.50.
Earlier, at 1049 GMT, it was down 0.6 per cent at 1,089.01 points on the back of a raft of gloomy corporate outlooks and a darkening technicals picture. The EuroSTOXX 50 also fell 0.6 per cent to 2,468.31 points,
“The companies are following what the macro environment is like so you are seeing a slowdown in revenues and companies are simply not hitting their targets,” said Matt Bolduc, strategist at Saxo Bank. “The market was not really prepared for that and we are seeing now the correction in some of the companies.”

AMERICA: Stocks closed mostly lower Friday after investors found little to like in weak corporate earnings reports and news of only tepid growth in the U.S. economy in the third quarter.

The Dow Jones industrial average managed a gain of 3.53 points to close at 13,107.21 after spending much of the day in the red.

The Standard & Poor’s 500 index fell 1.03 points to 1,411.94 and the Nasdaq composite rose 1.83 points to 2,987.95.

Stocks rose in the morning before a mild midday sell-off, then recovered somewhat in the afternoon.

The morning gains came after the Commerce Department estimated that the U.S. economy expanded at a 2 percent annual rate from July through September. That was better than the previous quarter, and better than analysts expected, but not strong enough to bring down the unemployment rate.

Even economic data that is mixed or positive won’t outweigh weak earnings, said Lawrence Creatura, a portfolio manager with Federated Investors. Reports like the one on Friday that measure gross domestic product tend to be backwards-looking, while companies are offering forecasts about the months ahead, he said.

“Company earnings trump macro data. Because investors own Apple, they don’t own GDP,” Creatura said.

Apple fell $5.54 to $604 after saying its profit will decline this holiday season.

Even with Friday’s rise, stocks lost ground this week, inflecting a sort of death-by-a-thousand-cuts on the rally that began in September. The Dow was down 236.30 points for the week, or 1.8 percent. The S&P has fallen 21.25 points, or 1.5 percent.

Goodyear Tire & Rubber sank 10 percent after a steep dropoff in sales in Europe delivered a blow to its earnings. The stock fell $1.28 to $11.02.

The advertising conglomerate Interpublic also turned in results that fell short of analysts’ forecasts, and its stock fell 2.5 percent, or 26 cents, to $10.29.

Amazon rose $15.32, or 7 percent, to $238.24 despite a smaller-than-expected quarterly profit and a prediction for smaller-than-expected holiday revenue.

Among other companies making big moves, cable TV provider Comcast jumped $1.20, or 3.3 percent, to $37.56 after reporting that its income more than doubled in the latest quarter. Revenue was higher than analysts were expecting, and more customers signed up for premium services like high-definition video recorders.

Varian Medical Systems jumped $8.83, or 15 percent, to $66.93, the biggest increase in the S&P 500 index. The company, which sells medical imaging equipment and radiation-emitting devices for treating tumors, reported a 20 percent rise in income because of higher sales of devices.

On its first day of trading, dairy company WhiteWave Foods lost 25 cents to $16.75, down from its initial public offering price of $17, after rising as high as $19.17 earlier.

The yield on the 10-year Treasury note fell to 1.75 percent from 1.82 percent on Thursday.

Benchmark Currency Rates

	USD	EUR	JPY	GBP	CHF	CAD	AUD	HKD
USD	–	1.2939	0.0126	1.6107	1.0699	1.0032	1.0374	0.1290
EUR	0.7726	–	0.0097	1.2445	0.8268	0.7752	0.8017	0.0997
JPY	79.6400	103.0700	–	128.3780	85.2500	79.8780	82.6290	10.2765
GBP	0.6209	0.8037	0.0078	–	0.6643	0.6227	0.6440	0.0801
CHF	0.9346	1.2096	0.0117	1.5055	–	0.9375	0.9696	0.1206
CAD	0.9970	1.2903	0.0125	1.6056	1.0672	–	1.0344	0.1286
AUD	0.9639	1.2473	0.0121	1.5524	1.0314	0.9669	–	0.1244
HKD	7.7504	10.0289	0.0973	12.4831	8.2936	7.7736	8.0402	–

 

Category: FinanceAsia