Sun, Sep 07, 2014 - Page 15 News List

Material producers’ slide pares gains in Asian stocks

Bloomberg and staff writer, with CNA

Asian stocks fell on Friday, with the regional benchmark index paring its weekly advance, as material and energy companies slid.

Newcrest Mining Ltd, Australia’s biggest gold producer, lost 3.2 percent after the price of bullion fell. Fortescue Metals Group Ltd, the nation’s third-largest iron ore miner, sank 3.2 percent after a gauge of prices for the raw material in China dropped. Oil explorer Inpex Corp fell 1.9 percent in Tokyo, as crude futures headed for the six weekly decline in seven weeks.

The MSCI Asia Pacific Index slipped 0.4 percent to 148.24 as of 8pm in Hong Kong, with three shares declining for every two that rose. The gauge posted a 0.2 percent advance for the week. Stocks climbed to a one-month high on Wednesday on reports showing faster growth in China’s service industries and US manufacturing.

“We’re seeing a bit of profit-taking today following the recent rally,” Ryan Huang, a market strategist at IG Ltd in Singapore, said by phone. “Investors are looking out for the US jobs data due tonight and the Chinese exports data next week.”

In Taipei, shares closed lower on Friday, extending losses from a session earlier as investor sentiment was hit hard by the revelation that recycled waste oil was used by major food product suppliers in their products, dealers said.

The bellwether electronics sector remained weak as many investors took to the sidelines to wait for the release of last month’s sales reports by major technology firms for more clues about peak season effects, they said.

The TAIEX ended down 20.95 points, or 0.22 percent, from Thursday at 9,407.94. It was also down from 9,436.27 on Aug. 29.

“Market sentiment has turned sour after the recycled oil scandal surfaced. Food safety concerns not only dampened interest in the food sector, but also in the broader market,” Asia Securities Investment Consultant (亞洲投顧) analyst Chang Chih-cheng (張智誠) said.

Wei Chuan Foods Corp (味全食品) on Thursday night announced a recall of 12 food products after admitting that it used recycled waste oil provided by Greater Kaohsiung-based Chang Guann Co (強冠企業).

According to Taiwan’s Food and Drug Administration, at least 235 food companies and restaurants, including Ve Wong Corp (味王), Taiwan Sugar Corp (台糖) and Gourmet Master Co (美食達人), have used the questionable oil.

Wei Chuan fell limit-down, closing at NT$40.40. Dealers said that the stock could suffer more downward pressure in the following sessions.

Selling in Wei Chuan spread to other food stocks, with Ve Wong down 3.32 percent at NT$23.30 and Gourmet Master down 4.23 percent at NT$238.00. The food sub-index ended down 1.29 percent.

“Fortunately, there was some bargain hunting to pick up Hon Hai (鴻海精密) and some financial stocks in the late session as the index moved closer to the nearest technical support at 9,300 points,” Chang said. “Otherwise, the local equity market would have lost more.”

Hon Hai rose 0.6 percent to close at NT$100.50, off an early low of NT$98.60, while Cathay Financial Holding Co (國泰金控) gained 0.39 percent to end at NT$52 after recovering from an early low of NT$51.60.

Meanwhile, South Korea’s KOSPI declined 0.3 percent. Australia’s S&P/ASX 200 Index slid 0.6 percent. India’s S&P BSE Sensex index, while Hong Kong’s Hang Seng Index and Singapore’s Straits Times Index each lost 0.2 percent.

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