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.
SECURITY: Taipei presses the US for arms supplies, saying the arms sales are not only a reflection of the US security commitment to Taiwan but also serve as a mutual deterrent against regional threats Taiwan is committed to preserving the cross-strait “status quo” and contributing to regional peace and stability, the Presidential Office said yesterday. “It is an undeniable fact that the Republic of China is a sovereign and independent democratic nation,” Presidential Office spokeswoman Karen Kuo (郭雅慧) reiterated, adding that Beijing has no right to claim sovereignty over Taiwan. The statements came after US President Donald Trump warned against Taiwanese independence. Trump wrapped up a state visit to Beijing on Friday, during which Chinese President Xi Jinping (習近平) had pressed him not to support Taiwan. Taiwan depends heavily on US security backing to deter China from carrying
The subsidiary of Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) in Kumamoto, Japan, turned a profit in the first quarter of this year, marking the first time the first fab of the unit has become profitable since mass production started at the end of 2024. According to the contract chipmaker’s financial statement released on Friday, Japan Advanced Semiconductor Manufacturing Inc (JASM), a joint venture running the fab in Kumamoto, posted NT$951 million (US$30.19 million) in profit in the January-to-March period, compared with a loss of NT$1.39 billion in the previous quarter, and a loss of NT$3.25 billion in the first quarter of
RESOLUTE BACKING: Two Republican senators are planning to introduce legislation that would impose immediate sanctions on China if it attempts to invade Taiwan US House of Representatives Speaker Mike Johnson on Sunday reaffirmed US congressional support for Taiwan, saying the US and “all freedom-loving people” have a stake in preventing China from seizing Taiwan by force. Johnson made the remarks in an interview with Fox News Sunday on US President Donald Trump’s summit with Chinese President Xi Jinping (習近平) last week. In an interview that aired on Friday on Fox News, just as Trump wrapped up a high-stakes visit to China, he said he has yet to green-light a new US$14 billion arms package to Taiwan and that it “depends on China.” “It’s a very good
DRONE CENTRAL: Taiwan aims to become Asia’s democratic hub for drones, with most exports focused on high-quality military-grade models, an official said Taiwan’s drone industry is expected to expand significantly by 2030, producing 100,000 units per month and exporting half of them, the Ministry of Economic Affairs said yesterday. Current drone production capacity is about 15,000 units per month, but the industry can quickly scale up as demand increases, Industrial Development Administration Director-General Chiou Chyou-huey (邱求慧) told a news conference in Taipei. Taiwan’s drone output grew 2.5-fold last year to NT$12.9 billion (US$408.3 million) under a government program to develop the uncrewed vehicle sector, he said. The Executive Yuan in October last year approved plans to invest NT$44.2 billion into domestic production of uncrewed aerial
RSS