Asian shares follow global sell-off on China, Ukraine

HEDGING BETS::Regional markets plunged after alarming data from the world’s No. 2 economy frayed the nerves of investors already anxious over the Moscow-West standoff

Bloomberg and AFP

Sun, Mar 16, 2014 - Page 15

Asian stocks fell this week, with the benchmark index capping its first weekly loss in five weeks, after Chinese data fueled concern about an economic slowdown and a rise in the yen sent Japanese shares lower.

Jiangxi Copper Co (江西銅業), which earns 92 percent of its revenue from China, dropped 5.8 percent in Hong Kong after prices for the metal slumped on concern that Chinese demand will weaken, while Toyota Motor Corp, a carmaker that generates 75 percent of its revenue abroad, lost 5.7 percent in Tokyo.

Also dropping this week were Malaysian Airline System Bhd, which fell 4 percent after one of its planes disappeared with 239 people aboard on March 8 and New World Development Co (新世界發展), which lost 17 percent after proposing to privatize its China property unit for HK$18.6 billion (US$2.4 billion).

The MSCI Asia Pacific Index conformed to the downward trend, sliding 3.5 percent to 134.32 this week in its steepest one-week decline in almost two years amid speculation that China would miss its 7.5 percent growth goal.

“The market started to pay more attention to negative data points,” White Funds Management managing director Angus Gluskie said.

China’s leaders are “using fiscal and monetary policy to control areas of growth, but investors are being cautious and I think they are getting nervous about what they say,” Gluskie added.

In Taipei, the TAIEX fell 0.69 percent, or 60.16 points, to close the week on 8,687.63, compared with 8,713.96 on March 7.

On Friday, Taiwan Semiconductor Manufacturing Co (台積電) slipped 1.29 percent to NT$115, while Hon Hai Precision Industry Co (鴻海精密) lost 0.7 percent to close at NT$85.5

In Hong Kong, the Hang Seng China Enterprises Index of mainland companies listed, also known as the H-share index, dropped 4.2 percent. The gauge is more than 19 percent down from a high on Dec. 2 last year and is nearing a so-called bear market. The Hang Seng Index also declined this week, falling 4.9 percent in the biggest decline since May 2012, while the Shanghai Composite Index lost 2.6 percent.

China’s factory production increased 8.6 percent annually in the January-to-February period, the Chinese National Bureau of Statistics said on Thursday, compared with the 9.5 percent median projection of analysts surveyed by Bloomberg News, while retail sales rose 11.8 percent, missing expectations for a 13.5 percent gain in the period.

Aggregate financing in China decreased to 938.7 billion yuan (US$153 billion) last month amid a crackdown on shadow lending, a government report this week showed. That compares with January’s record 2.58 trillion.

Chinese exports slid the most since 2009 last month, a separate report showed.

In Japan, the TOPIX slid 5.8 percent, its biggest weekly decline since June last year, while the smaller Nikkei 225 Stock Average lost 6.2 percent. Exporters slid after the yen rose as much as 0.5 percent to 101.36 to the US dollar.

Elsewhere in the region, South Korea’s KOSPI fell 0.3 percent, Australia’s S&P/ASX 200 Index dropped 2.4 percent after data showed companies boosted full-time payrolls last month by the most in more than 22 years and in Singapore, the Straits Times Index declined 2 percent.

In Wellington, the NZX 50 Index slid 0.9 percent this week after the Reserve Bank of New Zealand raised its key interest rate to make New Zealnd the first developed market nation to exit record-low borrowing costs this year.

On Friday, the NZX slid 0.64 percent, or 32.66 points, from Thursday to close on 5,079.32.

The MSCI Asia-Pacific gauge ended the week trading at 12.65 times estimated earnings, compared with multiples of 15.66 for the Standard & Poor’s 500 Index and 14.04 for the STOXX Europe 600 Index, data compiled by Bloomberg show.

In other markets on Friday:

Mumbai closed 22.55 points up from Thursday to finish the week at 21,797.16 points.

Manila closed 0.60 percent lower, giving up 38.55 points to close on 6,391.24.