Asian stocks posted their first annual decline in three years as sovereign-debt concerns in Europe and the US further cut into an earnings outlook eroded by China’s efforts to fight inflation and Japan’s record earthquake and tsunami.
The MSCI Asia Pacific Index fell 0.2 percent this week, taking its annual drop to 23.8 percent, as energy, financial and raw material companies declined.
Stocks fell this week as the publication of lending statistics by the European Central Bank underscored the magnitude of the region’s debt crisis and as China’s manufacturing contracted for a second month. Losses were tempered by better-than-estimated reports on pending home sales, consumer confidence and durable-goods orders in the US.
“This year , the world was swayed by the European debt crisis,” said Takashi Aoki of Tokyo-based Mizuho Asset Management Co. “More investors think the US economy is firmer and growing slowly and this will last for a while. Europe has entered a recession, but it’s unlikely to deteriorate badly. Emerging countries are transitioning from economic slowdown to faster growth again.”
The Taiwan Stock Exchange bade farewell to 2011 with a marginal loss in thin trade on Friday. As in the past, the market opened higher on the last trading day of the year, but failed to maintain ground.
The TAIEX closed on Friday at 7,072.08. The marginal loss disrupted a five-year streak in which the index had posted gains in the year’s final day of trading.
Overall, the index shed 1,900.42 points, or 21.18 percent down from the 2010 finish at 8,972.5. While the TAIEX managed to stay above the 7,000-point mark, total market capitalization shrank from NT$23.81 trillion (US$785.8 billion) to NT$19.18 trillion.
The figure could be translated into a loss of about NT$200,000 in assets for each of Taiwan’s 23 million people.
Japan’s Nikkei 225 Stock Average rose 0.7 percent this week, paring its annual loss to 17.3 percent. Hong Kong’s Hang Seng Index dropped 1.1 percent through the holiday-shortened week, taking its slide for last year to 19.8 percent. Just four Asian benchmark indices — Mongolia’s MSE Top 20 Index, Indonesia’s Jakarta Composite Index, the Philippine Stock Exchange Index and the FTSE Bursa Malaysia KLCI Index — advanced last year.
The Shanghai Composite Index tumbled 21.68 percent for the year, the most since 2008 and extending last year’s 14 percent plunge, on concern increases in borrowing costs and Europe’s debt crisis would derail economic growth. The index’s 33 percent drop since 2009 makes it the worst performer among the world’s 15 biggest markets.
South Korea’s KOSPI slipped 2.2 percent in the week. The KOSPI fell 10.5 percent last year. Australia’s S&P/ASX 200 Index fell for a second year, dropping 15 percent, as sagging global demand hurt mining companies and as a currency that’s gained 21 percent in 18 months made other exports less competitive.