Asian stocks fell, with the regional benchmark index headed for a six-month low after European slowdown concerns caused a rout in US shares and Hong Kong’s government canceled talks with pro-democracy protesters.
Inpex Corp, Japan’s biggest oil explorer, led losses among energy companies as crude futures extended a drop into a bear market, while in South Korea, retailer and resort operator Hotel Shilla Co capped its biggest weekly decline since December 2008 amid speculation that more duty-free shops will be allowed in the country. In Tokyo, Mitsubishi Materials Corp, which processes copper and zinc, slid 2.6 percent after a report it missed its first-half operating profit forecast.
The MSCI Asia Pacific Index dropped 1.6 percent to 136.47 as of 4:17pm in Hong Kong, heading for its lowest close since March 27 and a fifth weekly decline.
Asian stocks dropped as European Central Bank President Mario Draghi said the central bank must lift inflation from an “excessively low” level as the eurozone recovery falters and as the Standard & Poor’s 500 Index on Friday sank the most since April.
US Federal Reserve policymakers said in minutes of their last meeting that slowing global growth and the stronger greenback posed potential risks to the US outlook.
“Europe’s still in trouble,” CMC Markets market analyst Jasper Lawler said. “With stock valuations at lofty levels, investors are worried about anything that could derail earnings.”
The MSCI Asia Pacific traded at 13.4 times estimated earnings as of the last close, according to data compiled by Bloomberg. That is higher than the average over the past three years, the data show.
In Taipei, markets were closed on Friday for Double Ten National Day. In the week’s last trading session on Thursday, the TAIEX rose 0.13 percent, or 11.26 points, to 8,966.44, compared with 9,106.28 on Oct. 3.
On Thursday, Taiwan Semiconductor Manufacturing Co (台積電) rose 2.04 percent to NT$125, while Hon Hai Precision Industry Co (鴻海精密) was 0.93 percent higher at NT$97.6.
Hong Kong’s Hang Seng Index dropped 1.9 percent as the territory canceled talks with pro-democracy protesters after leaders of the movement called supporters back into the streets.
The occupation by demonstrators, who are upset with Beijing demands to vet candidates for the territory’s leadership, is illegal and must end, Hong Kong Chief Secretary Carrie Lam (林鄭月娥) said.
Elsewhere in Asia, China’s Shanghai Composite Index lost 0.6 percent. Japan’s TOPIX slid 1.4 percent, South Korea’s KOSPI retreated 1.2 percent, Singapore’s Straits Times Index slipped 0.9 percent, while Australia’s S&P/ASX 200 Index declined 2.1 percent and New Zealand’s NZX 50 Index lost 0.8 percent.
In other markets on Friday:
Mumbai was down 1.28 percent, or 339.90 points, from Thursday to close at 26,297.38 points.
Wellington fell 0.78 percent, or 40.90 points, to end on 5,224.14.
Manila finished the week 0.48 percent lower, shedding 34.54 points to 7,167.35.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by