Asian stocks fell to a two-month low this week, led by exporters such as Sony Corp and Hon Hai Precision Industry Co Ltd (鴻海精密), on concern widening credit losses in the US and record oil prices will slow global growth.
Posco led the slide among steelmakers and transportation stocks such as Qantas Airways Ltd and China Cosco Holdings Co fell after oil prices climbed to a record US$111 a barrel.
"The weakness in the US economy, coupled with high commodity prices, is combining to eat into margins for many Asian companies," said Ivan Tham, who helps oversee the equivalent of US$5 billion in Asian assets at City of London Investment in Singapore.
The MSCI Asia Pacific Index slid 2.6 percent this week, extending last week's 5.4 percent slump and this year's loss to 14 percent. Japan's Nikkei 225 Index dropped 4.2 percent, falling to its lowest since Aug. 10, 2005.
China's CSI 300 Index fell 10 percent this week, its biggest drop on record and the steepest loss in the region, on concern the government will raise interest rates to contain inflation, slowing growth in the world's fastest growing major economy.
A regional measure that includes steel and commodities companies dropped 4.9 percent and an index that includes airlines and shippers declined 4.2 percent, the worst performers among the MSCI Asia Pacific's 10 industry groups.
"There's fear in the markets," said David Ng, who helps manage about US$1 billion at Hwang-DBS Asset Management Sdn in Kuala Lumpur. "It's a case of when it rains, it pours, and it's pouring. What the market needs to know is how many more Carlyles are there."
Hon Hai, the world's largest contract manufacturer of consumer electronics, slumped 7.7 percent to NT$174.50, its second-biggest weekly decline this year, on concern that widening subprime losses will cool economic growth.
TAIPEI
Taiwanese share prices closed 0.6 percent lower, dealers said.
The weighted index closed down 49.6 points at 8,161.39 on turnover of NT$109.03 billion (US$3.55 billion).
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"Sluggish regional markets in the morning reminded investors of global economic concerns amid high energy costs," On said.
With presidential polls being held next week, many investors also cut their positions on fears over political uncertainty.
TOKYO
Japanese shares closed down 1.54 percent at the lowest level for two years and seven months on worries about a stronger yen and the weakness of the US economy, dealers said.
The benchmark Nikkei-225 index dropped 191.84 points to 12,241.60. The broader TOPIX index of all first-section shares ended down 22.64 points or 1.86 percent at 1,193.23.
HONG KONG
Hong Kong share prices closed 0.29 percent lower, dealers said.
The Hang Seng index closed down 64.53 points at 22,237.11.
For the week the Hang Seng is down 264.22 points or 1.17 percent, while for the year to date it is down 5,575.54 points or 20 percent.
SYDNEY
Australian shares closed 1.4 percent higher, dealers said.
The benchmark S&P/ASX 200 closed up 71 points at 5,206.9, while the broader All Ordinaries rose 72.8 points to 5,288.5.
SHANGHAI
Chinese share prices closed 0.22 percent lower, dealers said.
The benchmark Shanghai Composite index, which covers both A and B shares, fell 8.58 points to 3,962.67.
The Shanghai A-share index was down 0.21 percent to 4,157.52. The Shenzhen A-share index shed 0.86 percent to 1,302.12.
The Shanghai B-share index was down 0.68 percent to 288.33. The Shenzhen B-share index lost 1.55 percent to 572.61.
SEOUL
South Korean shares finished one percent lower on Friday, dealers said.
The benchmark KOSPI closed down 15.36 points at 1,600.26.
SINGAPORE
Singapore shares closed 1.2 percent higher on Friday, dealers said.
The Straits Times Index rose 33.46 points to close at 2,839.01.
"As we don't foresee a recession in the Singapore economy, despite our view that the US has already entered a recession, we believe that the market might have neared its bottom," Westcomb Securities said in a note to clients.
KUALA LUMPUR
Malaysian share prices closed 0.5 percent lower, dealers said.
The Kuala Lumpur Composite Index lost 6.51 points to 1,194.84.
BANGKOK
Thai share prices closed up 0.46 percent, dealers said.
The Stock Exchange of Thailand (SET) composite index rose 3.73 points to 818.04 and the blue-chip SET-50 added 2.80 points to 591.03.
JAKARTA
Indonesian shares closed 2.3 percent lower. The Jakarta Composite Index finished down 57.17 points at 2,383.42.
MANILA
Philippine share prices closed 1.2 percent lower, dealers said.
The composite index fell 33.94 points to 2,906.53 points. The broader all-share index lost 12.47 points or 0.7 percent to 1,784.44.
WELLINGTON
New Zealand share prices tumbled to close 2.04 percent lower, dealers said. The benchmark NZX-50 gross index dropped 73 points to 3,500.91.
MUMBAI
Indian shares rose 2.63 percent on Friday on bargain-hunting by domestic mutual funds, dealers said.
The Mumbai stock exchange SENSEX index rose 403.17 points to 15,760.52.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
The Financial Supervisory Commission (FSC) yesterday met with some of the nation’s largest insurance companies as a skyrocketing New Taiwan dollar piles pressure on their hundreds of billions of dollars in US bond investments. The commission has asked some life insurance firms, among the biggest Asian holders of US debt, to discuss how the rapidly strengthening NT dollar has impacted their operations, people familiar with the matter said. The meeting took place as the NT dollar jumped as much as 5 percent yesterday, its biggest intraday gain in more than three decades. The local currency surged as exporters rushed to
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