Asia: Mostly down, Tokyo hit by strong yen

07-Jan-2014 Intellasia | Business Times | Reuters | AFP | Bloomberg | AP | 7:52 AM Print This Post

Asian markets fell yesterday Monday January 6 in the first full day of trade in the new year, with Tokyo tumbling as the dollar and euro retreated from five-year highs against the yen.

Investors were given a mixed lead from Wall Street after Federal Reserve chief Ben Bernanke called for continued efforts to reinforce the recovery in the US economy.

Tokyo fell 2.35 per cent, or 382.43 points, to 15,908.88, Sydney lost 0.47 per cent, or 25.2 points, to 5,324.9, Shanghai gave up 1.80 per cent, or 37.43 points, to finish at 2,045.71. However, Seoul rose 0.37 per cent, or 7.14 points, to close at 1,953.28.

Japan’s Nikkei started the year with heavy losses after surging 57 per cent in 2013, with profit-taking adding to downward pressure, while the yen rebounded from recent lows.

“Tokyo stocks are overbought and a break in the yen’s fall, plus weaker futures are sure to result in some long-needed profit-taking after the December run-up,” said Hiroichi Nishi, general manager of equities at SMBC Nikko Securities.

HONGKONG:  STOCKS in Hong Kong fell yesterday, with the city’s benchmark index closing at an almost two-month low, after a private gauge of China’s services industries showed a decline.
The Hang Seng Index lost 0.6 per cent to 22,684.15, the lowest close since November 14.
ICBC slid two per cent to HK$4.96 and China Construction Bank Corp dropped 1.6 per cent to HK$5.59.
Cathay Pacific Airways fell one per cent to HK$15.92, Ping An Insurance eased 0.96 per cent to HK$66.75, while HSBC added 0.24 per cent to HK$83.15.

SINGAPORE:  THE benchmark Straits Times Index yesterday dropped 7.65 points, or 0.24 per cent, to 3123.82.
The FTSE ST Mid Cap Index lost 0.23 per cent, while the FTSE ST Small Cap Index added 0.19 per cent.
Among the top active stocks, SingTel lost 1.67 per cent, Memstar Technology added 4.76 per cent, OCBC fell 1.50 per cent and DBS gained 0.24 per cent.
Of the outperforming sectors, the FTSE ST Basic Materials Index added 3.61 per cent. Wilmar rose 0.30 per cent to S$3.36 while CapitaLand eased 0.67 per cent to S$2.96.

KUALA LUMPUR: Bursa Malaysia has queried Eco World Development Group Bhd on the sharp rise of its share price yesterday.
Shares of the property company had surged to its highest level of RM4.85 at noon.
The shares, however, ended the day three sen lower at RM4.36 from last Friday’s record close of RM4.39.
Business Times reported yesterday that Eco World seems to have done the impossible, with its stock rising by as much as 14 times over a 12-month period, with hardly any research coverage.
Eco World had peaked at RM4.44 last Friday.
A year ago, Eco World (then known as Focal Aims Bhd) was the ugly duckling among the Johor-based property developers, trading at a low of 30.5 sen a share.
Then, Liew Tian Xiong offered to buy 164.77 million shares, or 65.05 per cent, of the company for RM230.68 million cash.
The offer transformed the stock, expecially since Liew’s partners in the venture was Eco World Development Holdings Sdn Bhd, whose shareholders include Tan Sri Abdul Rashid Abdul Manaf and Datuk Eddie Leong Kok Wah.
Abdul Rashid and Eddie Leong are both former directors of SP Setia, where Liew’s father Tan Sri Liew Kee Sin is its current president as well as chief executive officer.

In other markets:

* Bangkok edged up 0.51 per cent, or 6.22 points, to 1,230.84. Banpu fell 4.72 per cent to 25.25 baht while Bangkok Bank rose 2.97 per cent to 173.50 baht.

* Jakarta dropped 1.29 per cent, or 54.85 points, to 4,202.81. State miner Aneka Tambang fell 3.37 per cent to 1,005 rupiah, while carmaker Astra International rose 1.48 per cent to 6,850 rupiah.

* Mumbai fell 0.31 per cent, or 64.03 points, to 20,787.30. Pharma firm Wockhardt fell 2.69 per cent to 431.05 rupees while private bank ICICI Bank fell 2.46 per cent to 1,040.70 rupees.

* Taipei fell 0.54 per cent, or 46.53 points, to 8,500.01. Hon Hai Precision eased 0.50 per cent to T$79.0 while TSMC was unchanged at T$102.5.

* Wellington was flat, edging down 3.7 points to 4,765.32. Contact Energy lost 1.35 per cent to NZ$5.10, Fletcher Building was up 0.81 per cent at NZ$8.69 and Air New Zealand was steady on NZ$1.645.

* Manila closed 0.64 per cent higher, adding 37.88 points to 5,985.81. Ayala Corp added 0.96 per cent to 525.50 pesos and its real estate arm Ayala Land put on 0.99 per cent to 25.50 pesos.

VIETNAM: Vietnamese stocks extended gain today with support from blue chips as investors eyed earnings results.
The benchmark VN Index added 3.73 points or 0.74% to 509.1. Volume rose 23.6% to 68.7 million worth of VND933.8 billion. Put-through trading contributed 0.6 million shares worth of VND21 billion. We saw 0.48 million MBB shares changed hands at the ceiling level of VND13,300 each and 0.1 million VNM shares changed hands at the ceiling level of VND145,000 each.
The market breadth was positive with 175 gainers, 51 losers and 52 unchanged.
The VN30 gained 3.5 points or 0.62% to 566.3. Among 30 constituents, 21 gained, 3 fell, 6 stood still.
Market opened in the green with 1.5 million shares changed hands. Market extended gaining as it progressed as buying into blue chips inspired the broader market. Speculative stocks also took the lead today.
Top 5 large caps, which accounted for roughly 50% of market capitalization were mixed, GAS, MSN gained while VCB lost, VNM, VIC stood still.
Blue chips with expectation of beating year earnings forecast posted strong gains including CSM, HPG, PPC, REE. Other blue chips also saw gains.
High beta stocks continued to perform well, VHG, PXL, PXS, MCG limited up.
Banking shares were mixed VCB, CTG lost, STB, MBB, EIB stood still.
On the Hanoi Stock Exchange, the HNX gained 0.86 point or 1.26% to 68.82. Trading volume fell 0.4% to 40.5 million shares worth VND320.7 billion.
The breadth was positive with 147 gainers, 62 losers, 68 unchanged and the rest untraded.
The HNX30 gained 2.68 points or 2.11% to 129.74.

EUROPE: European stock markets nudged higher yesterday, as investors returning to action after the festive break were met with upbeat eurozone data which boosted the euro.
London’s FTSE 100 index of leading companies added 0.02 per cent to stand at 6,731.80 points in midday trade. Frankfurt’s DAX 30 index gained 0.20 per cent to 9,453.61 points and in Paris CAC 40 firmed 0.07 per cent to 4,250.44.
“Equity index moves are reflecting the post-party deflated mood… and are trading flat to ever-so-slightly higher as traders return to their desks this week,” said market strategist Brenda Kelly at trading firm IG.
Investor sentiment won a partial boost as eurozone data appeared to confirm an improvement in the economy after earlier figures had stoked concern about the outlook.
Later this week investors will switch attention to interest rate decisions from the Bank of England and the European Central Bank.

AMERICA: The Standard & Poor’s 500 index notched its worst start to a year in almost a decade Monday, closing lower for the third straight trading day.

Although the declines for stocks in the New Year have been modest, the direction has been consistently down. The Standard & Poor’s 500 index has fallen 1.2 percent from its most recent record close on Dec. 31.

The performance is a contrast to last year, when the S&P 500 surged almost 30 percent, its best annual gain since 1997. The banner year ended with the stock market climbing to record levels amid signs that the economy was strengthening.

“The market is basically looking for additional confirmation of economic strength and maybe marking time as it catches its breath from a pretty strong run at year-end,” said Jim Russell, a regional investment director at US Bank.

The Standard & Poor’s 500 fell 4.60 points, or 0.3 percent, to 1,826.77. The Dow Jones industrial average dropped 44.89, or 0.3 percent, to 16,425.10. The Nasdaq composite fell 18.23, or 0.4 percent, to 4,113.68.

The weak start to the year is not a good omen for stock investors. The last time the S&P 500 dropped on the opening three trading days of the year in 2005, the index climbed just 3 percent for the whole year.

Despite the slow start, many analysts say it’s too early to call a change in the market’s upward trend.

Reports on the economy Monday contained some hopeful signs.

U.S. service companies grew at a steady but slightly slower pace in December. Sales dipped and new orders dropped to a four-year low, according to a report from the Institute for Supply Management. The report suggests that growth may remain modest in the coming months.

Factory orders climbed 1.8 percent in November, led by a surge in aircraft demand, the Commerce Department said.

The most closely watched economic report of the week will come on Friday when the Labor Department is scheduled to release its jobs survey for December. That’s going to influence the Fed’s decisions on how fast to reduce its bond purchases in the coming months.

Company earnings reports also start coming out this week, providing another catalyst that may lift the market. Alcoa, a former Dow stock, will be one of the first major companies to report its fourth quarter earnings after the close of trading on Thursday.

“This downturn is persisting a little bit more than I would expect,” said Jack Ablin, chief investment officer at BMO Private Bank. “Between the jobs report Friday and earnings results next week, we will have a much better idea of the drivers of the market.”

Among the winners on Monday were men’s clothing retailers Men’s Wearhouse and Jos. A. Bank. Both stocks rose after Men’s Wearhouse announced a $1.61 billion hostile bid early Monday for its smaller rival.

The offer came four months after Jos. A. Bank had made its own takeover bid for Men’s Wearhouse. That offer was rejected and Men’s Wearhouse bid for Jos. A. Bank instead. After failing to reach a deal, Men’s Wearhouse is now going directly to its rival’s shareholders.

Jos. A. Bank rose $2.46, or 4.5 percent, to $56.87. Men’s Wearhouse climbed $1.09 cents, or 2.2 percent, to $51.68.

Satellite radio company sirius XM was another stock that rose on takeover news.

Sirius climbed 26 cents, or 7.3 percent, to $3.83 after Liberty Media said late Friday that it wants to take full ownership of the satellite radio company in a deal that would value Sirius at nearly $23 billion.

In government bond trading, the yield on the 10-year Treasury note fell to 2.96 percent from 3 percent on Friday.

Among other stocks making big moves:

— Best Buy, one of best performers in the S&P 500 last year, slipped $1.27, or 3.1 percent, to $39.41 after Hhgregg, a competitor, said it expects to report lower holiday sales.

— PetSmart fell $2.03, or 2.8 percent, to $69.76 after analysts at Deutsche Bank advised their clients to sell the company’s stock, predicting the pet retailer will struggle as it faces increased competition.

Benchmark Currency Rates



1.3625 0.0096 1.6405 1.1050 0.9373 0.8932 0.1290


0.7340 0.0070 1.2043 0.8111 0.6879 0.6556 0.0946


104.4500 142.2300 171.3380 115.4230 97.8950 93.2850 13.4708


0.6096 0.8305 0.0058 0.6736 0.5714 0.5446 0.0786


0.9049 1.2329 0.0087 1.4845 0.8482 0.8083 0.1167


1.0669 1.4534 0.0102 1.7502 1.1790 0.9531 0.1376


1.1195 1.5251 0.0107 1.8364 1.2374 1.0493 0.1444


7.7546 10.5652 0.0743 12.7204 8.5691 7.2681 6.9240

Source: Bloomberg


Category: FinanceAsia

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