Asian stocks posted the biggest weekly decline since August after forecasts from Canon Inc to Japan Exchange Group Inc disappointed investors and money market rates in China surged.
Japan Exchange sank 5.8 percent in Tokyo this week after the main bourse operator in the world’s second-largest equity market failed to boost its full-year profit guidance, as analysts had expected.
Canon retreated 1.9 percent as the world’s largest camera maker trimmed its earnings forecast.
Industrial & Commercial Bank of China Ltd (中國工商銀行) fell 5.4 percent in Hong Kong as Asia’s biggest lender by market value paced a fall among financial shares.
The MSCI Asia Pacific Index sank 1.5 percent to 141.31 this week after climbing to a five-month high on Tuesday amid speculation that the US Federal Reserve would delay tapering stimulus. The slide pulled its earnings multiple down to 13.6 times estimated profit, data compiled by Bloomberg show.
“There are a lot of risks,” Nader Naeimi, Sydney-based head of dynamic asset allocation at AMP Capital Investors Ltd, said by telephone. “Only 50 percent of companies are beating forecasts on revenues. There’s also been a tightening in Chinese money markets and when you get news like this, markets are going to be more volatile.”
Of the 99 companies in the MSCI Asia Pacific Index that have reported quarterly results this earnings season and for which Bloomberg compiles estimates, 54 posted profit that missed expectations, while 56 missed sales estimates, the data show.
In Taipei, the TAIEX retreated 1.1 percent this week to end at 8,346.62 on Friday, compared with 8,441.19 on Oct. 18.
On Friday, the local bourse fell 0.8 percent, or 67.1 points, while HTC Corp (宏達電) rose 3.09 percent to NT$150 and Hon Hai Precision Industry Co Ltd (鴻海精密) fell 0.79 percent to NT$75.20.
Japan’s TOPIX fell 2.3 percent this week, but is still 37 percent higher this year — the largest rally among the 24 developed equity markets tracked by Bloomberg — amid optimism that Japanese Prime Minister Shinzo Abe’s policies and unprecedented monetary easing from the Bank of Japan will lead the country out of deflation.
South Korea’s KOSPI fell 0.9 percent even after data showed that the country’s economy grew more than forecast last quarter, while Hong Kong’s Hang Seng Index slid 2.8 percent in its biggest weekly retreat since August and China’s Shanghai Composite Index posted a second week of decline, falling 2.8 percent.
Elsewhere, Singapore’s Straits Times Index gained 0.4 percent, Australia’s S&P/ASX 200 Index rose 1.2 percent to post its third week of gains and New Zealand’s NZX 50 Index, which reached a record-high this week, advanced 2.2 percent.
In other markets on Friday:
Manila fell 0.67 percent, or 43.96 points, from Thursday to close at 6,539.81.
Mumbai fell 0.20 percent, or 41.91 points, to end the week at 20,683.52.
Wellington rose 0.59 percent, or 28.41 points, to finish at 4,863.35.
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Huawei Technologies Co’s (華為) latest smartphones carry a version of the advanced made-in-China processor it revealed last year, results from an independent analysis showed. This underscored the Chinese company’s ability to sustain production of the controversial chip. The Pura 70 series unveiled last week sports the Kirin 9010 processor, research firm TechInsights found during a teardown of the device. This is a newer version of the Kirin 9000s, made by Semiconductor Manufacturing International Corp (SMIC, 中芯) for the Mate 60 Pro, which had alarmed officials in Washington who thought a 7-nanometer chip was beyond China’s capabilities. Huawei has enjoyed a resurgence since
purpose: Tesla’s CEO sought to meet senior Chinese officials to discuss the rollout of its ‘full self-driving’ software in China and approval to transfer data they had collected Tesla Inc CEO Elon Musk arrived in Beijing yesterday on an unannounced visit, where he is expected to meet senior officials to discuss the rollout of "full self-driving" (FSD) software and permission to transfer data overseas, according to a person with knowledge of the matter. Chinese state media reported that he met Premier Li Qiang (李強) in Beijing, during which Li told Musk that Tesla's development in China could be regarded as a successful example of US-China economic and trade cooperation. Musk confirmed his meeting with the premier yesterday with a post on social media platform X. "Honored to meet with Premier Li