Home / World Business
Sun, Jun 08, 2008 - Page 10 News List

ASIA: Asian stocks fall for third week on reorganization

TURBULENCEThe MSCI Asia Pacific Index has been down 4.7 percent this year on credit-related losses and writedowns of as much as US$400 billion


Asian stocks fell for a third week, as Chinese telephone companies plunged after Beijing revealed details of an industry reorganization and concerns over bad loans dragged down Australian banks.

China Unicom Ltd, the smaller of the country’s two cellphone companies, had the biggest percentage decline on the MSCI Asia Pacific Index. National Australia Bank Ltd and Australia & New Zealand Banking Group Ltd declined in Sydney.

The MSCI Asia Pacific Index gained 0.3 percent to 150.37 last week. The index is down 4.7 percent this year on concern over credit-related losses and writedowns approaching US$400 billion will hurt earnings and near-record oil prices will slow economies.

“Conditions are still turbulent, and it’s too early to be optimistic,” said Masayuki Kubota, who helps oversee the equivalent of US$1.7 billion in Japanese stocks at Daiwa SB Investments Ltd in Tokyo. “It seems the shock to global financial markets has yet to come to an end.”

Japan’s Nikkei 225 Stock Average gained 1.1 percent, while the broader Topix added 1.3 percent. Most stock benchmarks in Asia fell, with Vietnam’s Ho Chi Minh Stock Index posting the biggest loss in the region.

Tenaga Nasional Bhd, Malaysia’s state-controlled power producer, surged the most in almost a decade in Kuala Lumpur on Friday, after winning government approval to raise electricity prices starting next month. Its shares jumped 23 percent to 9 ringgit, the sharpest gain on the MSCI Asian gauge.


Taiwanese shares are expected to extend gains next week on hopes of better ties with China ahead of bilateral talks due to be resumed after more than a decade, dealers said on Friday.

Transport and tourism shares and China that have close business relations with China are likely to attract market attention as they could gain most from improved cross strait relationships, they said.

The electronic sector may follow a rebound among US high tech stocks on their high correlation in share prices to push the market higher, they said.

The market is expected to test the crucial 9,000 point level this week, while profit taking may surface during the trade with a technical support seen at around 8,700 points, dealers said.

In the week to Friday, the weighted index closed up 126.27 points or 1.47 percent at 8,745.35, after a 2.44 percent fall a week earlier.

Average daily turnover stood at NT$97.57 billion (US3.21 billion), compared with US$121.14 billion a week earlier.

Talks between Taiwan’s Straits Exchange Foundation and China’s Association for Relations Across the Taiwan Strait will be resumed on Wednesday.

They are expected to become the theme of the market, Yuanta Securities Investment Consulting analyst Young Wang said.


Japanese share prices climbed to the highest level in about five months, boosted by an overnight rally on Wall Street and a weaker yen, which benefits exporters, dealers said.

The benchmark Nikkei-225 index rose 148.32 points or 1.03 percent to 14,489.44, the best finish since Jan. 9. The broader Topix index of all first-section shares added 3.66 points or 0.26 percent to 1,428.11.


Hong Kong share prices closed up 0.61 percent, dealers said.

The Hang Seng Index rose 146.89 points to 24,402.18. Turnover fell to 58.62 billion Hong Kong dollars (US$7.52 billion) from 63.69 billion dollars on Thursday.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top