Asian stocks had their biggest weekly drop since September as investors awaited data on Chinese retail sales and industrial production.
Chinese shares slid after a report Fosun International Ltd (復星國際) chairman Guo Guangchang (郭廣昌) was missing added to concerns that slowing economic growth, a weakening yuan and an anti-corruption campaign is clouding the outlook for corporate profits.
In a choppy final trading day of the week, Japanese shares rallied, while equities in China retreated.
Photo: Reuters
The MSCI Asia Pacific Index slipped 0.3 percent to 129.4, taking its weekly drop to 2 percent, a third weekly retreat. The gauge is down 6.2 percent this year as a rout in commodities and slowing Chinese growth weighs on the earnings prospects of companies from Sydney to Tokyo, before a US Federal Reserve decision next week on whether to raise interest rates.
“Asian markets had a mixed day to end the week,” said Angus Nicholson, Melbourne-based market analyst at IG Ltd. “Japanese markets have clearly reached levels where investors are happy with valuations again. Chinese markets were spooked by the ‘disappearance’ of Fosun’s chairman, quite likely by China’s anti-corruption department.”
The billionaire founder of the Chinese conglomerate has become unreachable, Caixin magazine reported on its Web site, citing people it did not identify. Fosun’s stock tumbled more than 11 percent to US$1.55 in over-the-counter trading in New York on Thursday, the biggest decline since August.
Bonds in Fosun International fell by a record and the company suspended its shares in Hong Kong after the report, while other mainland stocks with ties to Fosun also requested halts.
“Since lots of senior managers have gone missing like this case, it has negative implications on the market even though nobody knows what has happened,” said Ronald Wan, chief executive at Partners Capital International in Hong Kong. “Investors tend to be more cautious now.”
Hong Kong’s Hang Seng Index slipped 1.1 percent, extending a weekly loss to 3.5 percent, the most in 14 weeks. The Shanghai Composite lost 0.6 percent on Friday.
Chinese retail sales likely rose 11.1 percent last month from the previous year, after an 11 percent gain the month before, according to the median estimate in a Bloomberg survey of economists. Industrial production is expected to advance 5.7 percent, up from 5.6 percent in October.
In Taipei, the TAIEX took another beating on Friday to end below the 8,200-point mark amid fears that foreign institutions would continue to move funds out of the local equity market after a recent heavy sell-off, dealers said.
Many investors appeared reluctant to keep their holdings and continued to dump stocks, in particular big-cap issues, amid rising political uncertainty as the presidential election approaches, they said.
However, Hon Hai Precision Industry Co (鴻海) bucked the downtrend in the broader market to move higher after the world’s largest contract electronics maker a day earlier reported record-high sales for last month, they added.
The assembler of iPhones and iPads for Apple Inc gained 0.24 percent to close at NT$83.10 after it reported consolidated sales of NT$517.52 billion (US$15.7 million) for last month, up 2.89 percent from October.
The weighted index on the Taiwan Stock Exchange closed down 1.2 percent lower at 8,115.89 on Friday. It was also down 3.4 percent from 8,398.60 from the previous week.
Japan’s TOPIX added 0.6 percent and the Nikkei 225 Stock Average rallied 1 percent. Australia’s S&P/ASX 200 Index declined 0.2 percent, while New Zealand’s S&P/NZX 50 Index advanced 0.5 percent.
South Korea’s KOSPI lost 0.2 percent, Singapore’s Straits Times Index declined 0.5 percent and India’s S&P BSE SENSEX Index retreated 0.8 percent.
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