Sun, May 18, 2003 - Page 10 News List

Asian markets wallow with windless sails

INTERESTING TIMES A flurry of bad news from governments and companies, in addition to unemployment fears, sent the region's benchmarks scurrying for cover


Japan's stock benchmarks fell, after a government report showed the economy didn't grow in the first quarter, triggering a slide in shares of Ito-Yokado Co and other companies that depend on domestic sales.

Takeda Chemical Industries Ltd and other drugmakers rose, after the company said it will buy back shares for the first time and reported a ninth year of record profit.

The Nikkei 225 Stock Average fell 0.1 percent to 8117.29 at the 3pm close in Tokyo. The Topix index shed 0.1 percent to 819.17. For the week, the Nikkei lost 0.4 percent, while the Topix dropped 0.5 percent. Both benchmarks completed their first weekly declines in three.

Elsewhere in Asia, South Korea's Kospi index fell 1.4 percent, led by the benchmark's biggest members such as Samsung Electronics Co. A government report showed the jobless rate in April rose to an eight-month high, heightening concern that the economy won't pick up any time soon.

Hong Kong's Hang Seng Index fell 0.4 percent, led by banks such as Bank of East Asia Ltd, after the city reported personal bankruptcy orders rose more than half last month from a year earlier.

Benchmarks in Malaysia, India, and the Philippines rose, while all others declined. Indonesia's stock market was closed for a public holiday.

Nikkei 225 futures for June delivery shed 0.3 percent to 8110 in Osaka and lost 0.1 percent to 8125 in Singapore.

Ito-Yokado, Japan's largest general merchandise chain, fell 2.6 percent to ?2,815. Seven-Eleven Japan Co, Japan's largest convenience store operator, declined 1.7 percent to 2,950.

Isetan Co, the nation's No. 4 department store operator, dropped 8.2 percent to 715, its biggest drop in three years. The company yesterday said annual profit and sales declined.

The world's second-largest economy didn't grow in the first quarter, the Cabinet Office said. The median forecast in a Bloomberg News survey of 33 economists was for 0.1 percent growth and compares with growth of 0.5 percent in the fourth quarter.

Exports fell 0.5 percent in the first three months of the year and may fall further as severe acute respiratory syndrome curbs demand in Asia, which buys almost half of Japan's overseas shipments, and a slowing US economy.

"This year will be very tough indeed because of a slowdown in the US and the SARS problem," said Paul Heaton, who helps manage US$550 million in Japanese equities at Royal London Asset Management in the UK. He favors Kao Corp and Hoya Corp because they are focused on businesses that generate profits.

Takeda rose 2.7 percent to ?4,550. Japan's largest drugmaker said it plans to buy back as many as 30 million shares, or 3.4 percent of its shares. Takeda has some US$8.6 billion in cash, savings and marketable securities, the fourth-biggest reserve among drugmakers globally.

Takeda said full-year net income rose 15 percent to ?271.8 billion, its ninth year of record profits, helped by sales of newer drugs in Japan that are in high-growth sales phases.

The Kospi declined 8.54 to 610.81. The Kospi 200 futures contract dropped 1.8 percent to 77.70, while the underlying index lost 1.6 percent to 77.56.

Samsung Electronics, which is the world's biggest memory chipmaker and the largest stock on the Kospi, dropped 2.5 percent to 307,000 won. KT Corp, the nation's largest fixed-line telephone company, fell 2 percent to 46,850 won. Hyundai Motor Co slumped 2.9 percent to 28,500 won.

This story has been viewed 3032 times.

Comments will be moderated. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned.

TOP top