Sun, May 22, 2011 - Page 10 News List

Asian stocks fall for third week on Greece debt crisis

Agencies, with Staff Writer

Asian stocks fell, dragging the region’s benchmark index to the longest streak of weekly declines since November, as Greece’s debt crisis grew, Japan’s economy contracted and disappointing US economic data fueled concern about a global recovery.

The MSCI Asia-Pacific Index declined 1.1 percent to 134.61 this week, its third straight drop. The gauge retreated 1 percent the previous week as China restricted bank lending, stoking concern anti-inflation policies may slow growth in the world’s second-biggest economy.

“The Greece issue is worrying markets because it’s clear the situation hasn’t been resolved yet,” said Nader Naeimi, a Sydney-based strategist for AMP Capital Investors Ltd, which has almost US$100 billion under management. “Global growth has hit a soft patch and that’s negative for Asian exporters overall. Investors have become more risk-averse, with the defensive sectors taking leadership.”

Japan’s Nikkei 225 Stock Average lost 0.4 percent. South Korea’s Kospi index dropped 0.4 percent. Australia’s S&P/ASX 200 Index climbed 0.4 percent in the week. Hong Kong’s Hang Seng index slid 0.3 percent while China’s Shanghai Composite Index lost 0.4 percent.

Authorities stepped up pressure on Greece to sell assets and deepen spending cuts to win an increase of its 110 billion euro (US$156 billion) aid package and more time to repay the loans. In -deliberations clouded by the absence of arrested IMF managing director Dominique Strauss-Kahn, who resigned on May 19, Europe’s rich countries also weighed whether to make holders of Greek bonds assume some losses.

A Greek default would be “highly destabilizing” for banks, causing losses that “far exceed” the size of their loans and investments, according to Moody’s Investors Service.

Taiwanese share prices finished down on profit taking on Friday and closed at their lowest level since April 20.

The weighted index fell 55.85 points, or 0.62 percent on Friday, to 8,837.03 points, after moving between 8,822.75 and 8,944.38, on turnover of NT$95.398 billion (US$3.32 billion).

The close was the lowest since April 20, when the index finished at 8,813.28. For the week, the market was down 1.9 percent.

Cement stocks and plastics and chemicals shares suffered the heaviest selling of the market’s eight major stock categories on Friday, finishing down 1.1 percent.

In other markets on Friday:

Manila ended 0.30 percent, or 12.77 points, lower from Thursday at 4,285.16.

Wellington closed up 0.24 percent, or 8.44 points, from Thursday at 3,577.44.

Mumbai rose 1.02 percent. The benchmark 30-share SENSEX closed up 184.69 points from Thursday at 18,326.09.

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