Asian markets were mixed yesterday Friday October 19 as a week-long rally fuelled by upbeat data out of China and rising hopes for the future of the eurozone was stalled by profit-taking.
Investors did not seem to be immediately moved by news out of Europe that leaders had reached a deal on a banking union within the trading bloc.
Tokyo stocks capped their best week of the year with a modest gain after buying on optimism over the global economy offset profit-taking.
The Nikkei 225 Index extended its winning streak to a fifth day, closing up 0.22 per cent, or 19.82 points, at 9,002.68. It was the first time since September 25 that the index closed above the major chart line of 9,000. It surged 5.5 per cent over the week.
The broader Topix index of all first-section issues ended at 754.39, up 0.28 percent or 2.09 points from Thursday.
“There were fears the market is now short-term overheated after the recent rally, but upward momentum remains intact,” said Kenichi Hirano, market analyst at Tachibana Securities.
However, Chinese shares closed down 0.16 per cent on concerns over the upcoming corporate reporting season.
The benchmark Shanghai Composite Index slipped 3.39 points to 2,128.30. It gained 1.11 per cent over the week.
Sydney rose 0.26 per cent, or 11.7 points, to 4,571.1 but Seoul lost 0.78 per cent, or 15.28 points, to end at 1,943.84.
Traders took a breather after regional markets enjoyed a strong rally this week following data from China indicating its economy may have bottomed out.
HONG KONG: SHARES closed higher yesterdayy, ending a strong week on a high after a string of data out of China indicated a slowdown in the world’s number two economy has bottomed out.
The benchmark Hang Seng Index rose 0.15 per cent, or 33.05 points, to 21,551.76 – the highest since March 2. The index ended the week 1.96 per cent higher.
However, “the market looks quite overbought, so we’re likely to have a pullback before the market resumes its uptrend”, Steven Leung, director of institutional sales at UOB KayHian, told Dow Jones Newswires.
SINGAPORE: SOUTHEAST Asian stock markets ended weaker to flat yesterday as investors cashed in on earlier gains in regional large caps and banks amid global market weakness.
In Singapore, the market ended slightly weaker. The benchmark Straits Times Index closed 0.37 per cent, or 11.44 points, lower at 3,048.92.
Singapore-listed shares of Thailand’s Total Access Communication, the No. 2 telecoms company there, dropped 2.4 per cent.
Among other actives, Singapore Telecom dropped 0.62 per cent to S$3.19 and DBS Bank was down 0.91 per cent to S$14.09.
KUALA LUMPUR: THE local stock market set several records yesterday, with the FTSE Bursa Malaysia KLCI (FBM KLCI) hitting an all-time high of 1,670.16 points at one stage, dealers said.
The market barometer fell back to end just 0.93 point higher at 1,666.35 in mixed trading, with support seen mostly in telecommunication and banking stocks.
Inter-Pacific Research Sdn Bhd head of research Pong Teng Siew said the record-setting spree was driven largely by the rise in banking stocks led by Public Bank which announced its financial results on Thursday.
“As we go along, banking stocks will remain the main driver on the local bourse. With banking stocks having big weightage on FBM KLCI, it will drive the index to a new high,” he said.
Losers outnumbered gainers 409 to 294 while 338 counters were unchanged, 602 untraded and 22 others were suspended.
Astro, which made its comeback debut at RM3.03 for a premium of three sen, failed to sustain its upward momentum and closed below its offer price, with 269.74 million shares traded.
Among actives, Scomi added three sen to 41.5 sen and KNM-OR edged up half-a-sen to 16 sen. Axiata added eight sen to RM6.68.
Among the heavyweights, Maybank shed two sen to RM9.09, Sime Darby eased one sen to RM9.79, CIMB slipped three sen to RM7.62 and Petronas Chemicals dropped nine sen to RM6.56.
Meanwhile, FBM KLCI futures contracts closed slightly lower on the back of a mixed cash market, dealers said.
October 2012 and December 2012 each closed 5.5 points lower at 1,662 and 1,661.5 respectively, while November 2012 slipped 6.5 points to 1,662 and March 2013 dropped 4.5 points to 1,656.5.
In other markets:
* Taipei fell 0.76 per cent, or 56.65 points, to 7,408.76.
* Manila closed flat, edging down 3.58 points to 5,432.36.
* Jakarta fell 0.6 per cent, or 25.71 points, to 4331.254.
* Bangkok lost 0.27 per cent, or 3.50 points, to 1,307.71.
* Mumbai slipped 0.58 per cent, or 109.62 points, to 18,682.31.
VIETNAM: Vietnamese shares fell for a third straight day as selling pressure rose in highly speculative shares such as PVX, VND, ITA.
The benchmark VN Index lost 0.28 point or 0.07% to 398.23. Volume rose 27.7% to 52.6 million shares worth of VND645.8 billion.
Put through trading contributed 0.6 million shares worth of VND11.31 billion.
Today’s market breadth remained negative on the primary bourse where 65 stocks advanced, 152 declined, 59 closed unchanged.
The VN30 fell 0.7 point or 0.15%, to 471.26. Among its 30 members 4 gained, 22 lost the ground and 4 unchanged.
On the Hanoi Stock Exchange, the HNX lost 1.08 points or 1.93% to 54.74.
Trading volume rose 45% to 44.2 million shares worth VND314.1 billion as selling pressure rose.
The market breadth turned negative where 58 rallied, 146 declined, 60 closed unmoved, the rest untraded.
The HNX30 lost 2.87 points or 2.71% to 102.89. Of its 30 members, 1 rallied, 25 declined, 4 closed unmoved.
EUROPE: European shares fell back yesterday, though remained within striking distance of the year’s highs, as unexpectedly weak results from US tech bellwether Google bruised investor sentiment.
The FTSEurofirst 300 was down 0.5 per cent at 1,114.83 by 1111 GMT.
“If the market can withstand major companies disappointing, it gives you an idea that the underlying market is strong,” Philippe Gijsels, head of research at BNP Paribas Fortis Global Markets in Brussel, said.
Britain’s FTSE 100 lost 0.1 per cent to 5,910.04 in early trading. Germany’s DAX was 0.4 per cent lower to 7,411.65 and France’s CAC-40 lost 0.3 per cent at 3,523.74.
AMERICA: Poor corporate earnings reports pounded the stock market Friday in a sour end to an otherwise strong week of trading. The Dow Jones industrial average fell more than 200 points for its worst day in four months.
Disappointing results from three giants of the Dow — Microsoft, General Electric and McDonald’s — were partly to blame. The Standard & Poor’s 500 index fared even worse, as widespread worries about companies’ ability to keep churning out better profits drove the broader market down.
Through Thursday, with 115 companies in the S&P 500 reporting, earnings have dropped 3.7 percent compared with a year earlier, according to Thomson Reuters, a financial data provider, and ING, a financial company.
The Dow sank 205.43 points, or 1.5 percent, to close Friday at 13,343.51. The S&P lost 24.15, or 1.7 percent, to 1,433.19. The Nasdaq composite index, hammered by a second ugly day for Google, lost 67.25 points to 3,005.62, a 2.2 percent decline. The big drops Friday left the Dow and S&P clinging to gains for the week.
All 10 industry groups in the S&P 500 fell, led by technology and materials stocks. Google continued its slump, losing $13.21 to $681.79, a day after its earnings report was accidently hours ahead of schedule. The report raised questions for Google and other Internet companies about ads that target mobile devices.
It’s been a tough week for technology companies. IBM pointed to Europe’s troubles and slowing business spending when it posted weaker revenue than analysts expected. Intel, the world’s largest maker of computer chips, blamed the global economy and sliding computer sales for pushing net income down.
The bad news kept piling up Friday. Sagging PC sales and trouble in Europe took a toll on Microsoft’s net income. Its stock lost 86 cents, or 3 percent, to $28.64. Marvell Technology Group and Advanced Micro Devices, which also make chips, sank sharply.
McDonald’s profit shrank as a strong dollar hurt international results, which account for two-thirds of its business. The fast-food giant’s stock lost $4.14, more than 4 percent, to $88.72.
General Electric, a bellwether of the economy, fell 3 percent. The company reported stronger profits early Friday, but its revenue missed Wall Street’s expectations. Orders for new equipment and services sank, mainly because wind turbine orders have fallen because a key U.S. federal subsidy for wind power expires at the end of the year. GE’s stock lost 78 cents to $22.03.
As corporate earnings roll in, banks and so-called consumer discretionary companies, which include luxury stores and hotels, are projected to report the best growth.
Analysts expect companies dealing in metals and other materials to report the worst results, followed by energy companies. But it’s technology companies like IBM, Intel and Google whose results have grabbed the most attention.
The losses left the Dow up just 0.1 percent for the week. The S&P was up 0.3 percent, and the Nasdaq was down 1.3 percent.
As investors sold stocks, they bought U.S. government bonds, driving prices up and yields down. The yield on the benchmark 10-year Treasury note slipped to 1.77 percent from 1.83 percent late Thursday.
The disappointing earnings and a report showing a drop in home sales last month also pushed energy prices lower. The price of oil fell 2.2 percent on the New York Mercantile Exchange. Benchmark crude lost $2.05 to end at $90.05 per barrel.
Among other stocks making big moves:
• Chipotle Mexican Grill plunged 15 percent after the burrito chain forecast that revenue growth would slow sharply next year. The stock had been a favorite among investors thanks to super-fast growth in recent years. The stock fell $42.93 to $243.
• Capital One Financial surged 6 percent, making it the top performer in the S&P 500. Capital One’s quarterly results, reported late Thursday, easily trumped analysts’ estimates as profits jumped 47 percent. The lender’s purchase of both the online bank ING Direct and HSBC’s U.S. credit-card division helped propel loan revenue. Capital One’s stock gained $3.45 to $60.75.
• Advanced Micro Devices, the world’s second-largest maker of microprocessors behind Intel, plunged 17 percent. AMD said late Thursday that sales of its chips have dwindled as buyers shift away from personal computers in favor of tablets and smartphones. It also plans to cut 15 percent of its workforce. AMD lost 44 cents to $2.18.
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