Asian stocks dropped for the second straight week on concern that companies will book losses from Dubai’s plan to delay debt payments and that share sales by banks will erode the value of existing holdings.
Kajima Corp fell 16 percent after Daiwa Securities SMBC Co said Japanese builders may lose “tens of billions of yen” if Dubai’s investment fund succeeds in delaying debt payments. Bank of China Ltd (中國銀行), which said this week it’s studying options to replenish capital, dropped 13 percent. Sony Corp, the maker of the PlayStation 3 game console, slid 6 percent as the US dollar sank to a 14-year low against the yen. Santos Ltd, Australia’s third-biggest producer of oil and gas, slumped 4.6 percent as crude oil prices retreated in New York.
The MSCI Asia-Pacific Index fell 2.6 percent to 113.90 this week, dragged down the most by financial companies. The gauge has climbed 61 percent from its lowest level in more than five years on March 9, amid signs government stimulus measures are reviving economies around the world.
“People are worried about the contagion effect from Dubai,” said Nader Naeimi, a Sydney-based strategist at AMP Capital Investors, which oversees US$75 billion. “Events like this bring back all the bad memories from the global financial crisis. The market has rallied a long way and is very sensitive to any bad news around debt default or financial problems.”
Japan’s Nikkei 225 Stock Average index lost 4.4 percent for a fifth weekly drop, even as exports last month fell at the slowest pace in a year as government spending helped bolster demand.
South Korea’s KOSPI Index sank 5.9 percent, during a week in which a central bank survey showed manufacturers’ confidence slipped to the lowest level in four months.
Hong Kong’s Hang Seng Index declined 5.9 percent, and the Shanghai Composite Index retreated 6.4 percent. Vietnam’s VN Index tumbled 12 percent as the central bank devalued the currency to curb inflation and narrow the trade deficit.
Taiwanese shares are expected to see further falls next week after Dubai’s shock call to suspend the debt of a key state firm caused new jitters over the global financial health, dealers said on Friday.
However, the government may step in to support the market and offset the pressure, wary of allowing too somber a mood ahead of local elections scheduled for Saturday, according to dealers.
For the week to Friday, the weighted index fell 192.06 points or 2.50 percent to 7,490.91 after a 0.23 percent increase a week earlier.
Average daily turnover stood at NT$120.85 billion, compared with NT$134.30 billion a week ago.
Other regional markets on Friday:
SYDNEY: Down 2.90 percent from Thursday. The S&P/ASX 200 suffered its biggest one-day fall in five months, losing 136.5 points, to end at 4,572.1.
BANGKOK: Down 0.78 percent from Thursday. The SETlost 5.36 points to close at 680.37.
MANILA: Down 1.45 percent from Thursday. The composite index shed 44.85 points to 3,044.97.
WELLINGTON: Down 1.05 percent from Thursday. The NZX-50 index fell 32.88 points to 3,094.44
MUMBAI: Down 1.32 percent from Thursday. The SENSEX fell 222.92 points to 16,632.01.
MORE VISITORS: The Tourism Administration said that it is seeing positive prospects in its efforts to expand the tourism market in North America and Europe Taiwan has been ranked as the cheapest place in the world to travel to this year, based on a list recommended by NerdWallet. The San Francisco-based personal finance company said that Taiwan topped the list of 16 nations it chose for budget travelers because US tourists do not need visas and travelers can easily have a good meal for less than US$10. A bus ride in Taipei costs just under US$0.50, while subway rides start at US$0.60, the firm said, adding that public transportation in Taiwan is easy to navigate. The firm also called Taiwan a “food lover’s paradise,” citing inexpensive breakfast stalls
TRADE: A mandatory declaration of origin for manufactured goods bound for the US is to take effect on May 7 to block China from exploiting Taiwan’s trade channels All products manufactured in Taiwan and exported to the US must include a signed declaration of origin starting on May 7, the Bureau of Foreign Trade announced yesterday. US President Donald Trump on April 2 imposed a 32 percent tariff on imports from Taiwan, but one week later announced a 90-day pause on its implementation. However, a universal 10 percent tariff was immediately applied to most imports from around the world. On April 12, the Trump administration further exempted computers, smartphones and semiconductors from the new tariffs. In response, President William Lai’s (賴清德) administration has introduced a series of countermeasures to support affected
CROSS-STRAIT: The vast majority of Taiwanese support maintaining the ‘status quo,’ while concern is rising about Beijing’s influence operations More than eight out of 10 Taiwanese reject Beijing’s “one country, two systems” framework for cross-strait relations, according to a survey released by the Mainland Affairs Council (MAC) on Thursday. The MAC’s latest quarterly survey found that 84.4 percent of respondents opposed Beijing’s “one country, two systems” formula for handling cross-strait relations — a figure consistent with past polling. Over the past three years, opposition to the framework has remained high, ranging from a low of 83.6 percent in April 2023 to a peak of 89.6 percent in April last year. In the most recent poll, 82.5 percent also rejected China’s
PLUGGING HOLES: The amendments would bring the legislation in line with systems found in other countries such as Japan and the US, Legislator Chen Kuan-ting said Democratic Progressive Party (DPP) Legislator Chen Kuan-ting (陳冠廷) has proposed amending national security legislation amid a spate of espionage cases. Potential gaps in security vetting procedures for personnel with access to sensitive information prompted him to propose the amendments, which would introduce changes to Article 14 of the Classified National Security Information Protection Act (國家機密保護法), Chen said yesterday. The proposal, which aims to enhance interagency vetting procedures and reduce the risk of classified information leaks, would establish a comprehensive security clearance system in Taiwan, he said. The amendment would require character and loyalty checks for civil servants and intelligence personnel prior to