Asian stocks slumped, dragging the MSCI Asia-Pacific Index to its second drop in three weeks, as a record plunge in US home sales and slowing export growth in Japan added to evidence the global recovery is faltering.
Canon Inc, which makes 78 percent of its sales outside Japan, retreated 2.8 percent. James Hardie Industries SE, the biggest seller of home siding in the US, dropped 2.6 percent. LG Electronics Inc, the world’s third-largest mobile-phone maker, slumped 7.7 percent as consumer sentiment in its home market in South Korea declined. China Life Insurance Co (中國人壽), China’s No. 1 insurer, tumbled 9.8 percent after Citigroup Inc said first-half earnings were “weak.”
“The US economy now seems to be weaker than markets expected,” said Stephen Halmarick, who helps manage about US$135 billion as head of investment markets research at Colonial First State Global Asset Management in Sydney. “Investors are worried growth will fade sharply and that an improvement in company profits will reverse.”
The MSCI Asia-Pacific Index dropped 1.2 percent to 116.82 this week, following last week’s 0.4 percent gain. The index has slumped about 9.5 percent from its high this year on April 15 as Europe’s debt crisis, China’s measures to curb property-price inflation and disappointing economic reports in the US fueled concern global growth may stall.
Japan’s Nikkei 225 Stock Average slumped 2.1 percent as Japan’s export growth slowed last month, adding to risks in an economy already under threat by the yen’s appreciation. The Shanghai Composite Index dropped 1.2 percent as shares of developers dropped on speculation the government will introduce a property tax.
Australia’s S&P/ASX 200 Index fell 1.4 percent as Australian business investment unexpectedly fell in the second quarter and neither Prime Minister Julia Gillard nor opposition leader Tony Abbott gained an outright majority in last weekend’s national election.
South Korea’s KOSPI fell 2.6 percent as South Korea’s consumer confidence fell for the first time in five months, according to a Bank of Korea statement on Wednesday.
Shares of technology companies and raw material suppliers posted the biggest decline among 10 industry groups on the MSCI Asia-Pacific Index this week.
Japanese exporters declined after the yen advanced to a 15-year high against the US dollar on Wednesday as economic growth concerns boosted demand for refuge assets. A stronger yen reduces overseas income at Japanese companies converted into their home currency.
Japan’s export growth slowed for a fifth month in July, government data release on Wednesday showed. Japanese Prime Minister Naoto Kan said on Friday the government is ready to take “bold” action in the currency market when necessary.
Disappointing economic data from the US, one of biggest markets for Asia’s exports, sparked concern shipment of goods from the region will weaken.
“The US is a big consumer of goods manufactured in Asia,” said Prasad Patkar, who helps manage US$1.6 billion at Platypus Asset Management in Sydney. “Weakness in the US implies softer demand for Asian exports, which weighs down on growth in the region.”
Taiwan’s TAIEX rose 33.17, or 0.4 percent, to 7,722.91 at the 1:30pm close of Taipei trading on Friday, snapping three days of declines. The benchmark fell 2.6 percent this week, the most in 14 weeks.
Other markets on Friday:
Manila fell 1.03 percent, or 36.91 points, from Thursday to 3,558.67.
Wellington closed down 0.36 percent, or 10.81 points, from Thursday at 3,007.44.
Jakarta fell 1.28 percent, or 40.40 points, from Thursday to 3,104.73, with most of the falls among commodity-related and banking stocks.
Mumbai fell 1.25 percent, or 227.94 points, from Thursday to 17,998.41.
ROLLER-COASTER RIDE: More than five earthquakes ranging from magnitude 4.4 to 5.5 on the Richter scale shook eastern Taiwan in rapid succession yesterday afternoon Back-to-back weather fronts are forecast to hit Taiwan this week, resulting in rain across the nation in the coming days, the Central Weather Administration said yesterday, as it also warned residents in mountainous regions to be wary of landslides and rockfalls. As the first front approached, sporadic rainfall began in central and northern parts of Taiwan yesterday, the agency said, adding that rain is forecast to intensify in those regions today, while brief showers would also affect other parts of the nation. A second weather system is forecast to arrive on Thursday, bringing additional rain to the whole nation until Sunday, it
CONDITIONAL: The PRC imposes secret requirements that the funding it provides cannot be spent in states with diplomatic relations with Taiwan, Emma Reilly said China has been bribing UN officials to obtain “special benefits” and to block funding from countries that have diplomatic ties with Taiwan, a former UN employee told the British House of Commons on Tuesday. At a House of Commons Foreign Affairs Committee hearing into “international relations within the multilateral system,” former Office of the UN High Commissioner for Human Rights (OHCHR) employee Emma Reilly said in a written statement that “Beijing paid bribes to the two successive Presidents of the [UN] General Assembly” during the two-year negotiation of the Sustainable Development Goals. Another way China exercises influence within the UN Secretariat is
LANDSLIDES POSSIBLE: The agency advised the public to avoid visiting mountainous regions due to more expected aftershocks and rainfall from a series of weather fronts A series of earthquakes over the past few days were likely aftershocks of the April 3 earthquake in Hualien County, with further aftershocks to be expected for up to a year, the Central Weather Administration (CWA) said yesterday. Based on the nation’s experience after the quake on Sept. 21, 1999, more aftershocks are possible over the next six months to a year, the agency said. A total of 103 earthquakes of magnitude 4 on the local magnitude scale or higher hit Hualien County from 5:08pm on Monday to 10:27am yesterday, with 27 of them exceeding magnitude 5. They included two, of magnitude
Taiwan’s first drag queen to compete on the internationally acclaimed RuPaul’s Drag Race, Nymphia Wind (妮妃雅), was on Friday crowned the “Next Drag Superstar.” Dressed in a sparkling banana dress, Nymphia Wind swept onto the stage for the final, and stole the show. “Taiwan this is for you,” she said right after show host RuPaul announced her as the winner. “To those who feel like they don’t belong, just remember to live fearlessly and to live their truth,” she said on stage. One of the frontrunners for the past 15 episodes, the 28-year-old breezed through to the final after weeks of showcasing her unique