Asian stocks fell for a second week, as investors weighed the timing of a reduction in the US Federal Reserve’s unprecedented stimulus amid improving US data.
BHP Billiton Ltd, the world’s largest mining company, slumped 2.5 percent in Sydney. Nitto Denko Corp, a Japanese chemical products maker, plunged 18 percent after cutting its profit forecast.
Haier Electronics Group Co (海爾電器) soared 21 percent in Hong Kong after Alibaba Group Holding (阿里巴巴) agreed to invest HK$2.82 billion (US$364 million) in the home-appliance maker and its logistics business. Gree Inc surged 9.9 percent in Tokyo after Goldman Sachs Group raised its outlook on the operator of a mobile gaming social network.
“After a strong November, markets in Asia were overbought, which made them vulnerable to some falls,” said Nader Naeimi, Sydney-based head of dynamic asset allocation at AMP Capital Investors. “The transition from a liquidity or monetary policy driven rally to a fundamentally driven rally will create nervousness and volatility, but I believe bulls will come out on top.”
The MSCI Asia Pacific Index dropped 1.1 percent to 137.94 this week after falling the past three days. The gauge has gained 6.6 percent this year, as the Bank of Japan deployed unprecedented stimulus and China’s economy showed signs of stabilization.
The index traded at 13.6 times estimated earnings as of Friday, compared with multiples of 16 for the Standard & Poor’s 500 Index and 14.6 for the STOXX Europe 600 Index, according to data compiled by Bloomberg.
Australia’s S&P/ASX 200 Index fell 1.7 percent, South Korea’s KOSPI lost 0.9 percent, Hong Kong’s Hang Seng Index declined 2.1 percent, China’s Shanghai Composite slid 1.8 percent and Singapore’s Straits Times Index slid 1.6 percent.
Taiwan’s TAIEX bucked the trend, edging up 0.1 percent to close the week at 8,376.94. Shares rebounded on Friday, but turnover remained thin, making it hard for the index to overcome technical resistance at 8,400 points, dealers said.
Many investors preferred to stay on the sidelines amid lingering concerns that the Fed may decide next week to wind down its massive monthly fund injections into the US economy, dealers said.
The electronics sub-index closed 0.15 percent lower on Friday, with chip designer MediaTek Inc (聯發科) falling 0.95 percent to NT$417.
MediaTek shares faced pressure as investors feared its shipments would be affected by a possible shutdown of part of chip packager Advanced Semiconductor Engineering Inc’s (ASE, 日月光半導體) plant due to pollution concerns. ASE shares, however, rose 0.18 percent to close at NT$27.65, snapping a three-session losing streak.
Greater Kaohsiung’s Environmental Protection Bureau found on Monday that one of ASE’s plants had been dumping wastewater containing heavy metals into Houjing Creek, a major irrigation source for farmlands. The plant could face a shutdown.
Fortunately, buying rotated to the financial sector on expectations that life insurance companies will see their property asset value rising due to a change in the accounting methods,” Asia Securities Investment Consultant (亞洲投顧) analyst Chang Chih-cheng (張智誠) said.
The Fed will probably start reducing its US$85 billion of monthly bond purchases at its meeting on Tuesday and Wednesday, according to 34 percent of economists surveyed on Dec. 6 by Bloomberg, up from 17 percent in a Nov. 8 poll.
In other markets on Friday:
Mumbai closed down 1 percent, or 210.03 points, from Thursday at 20,715.58.
Wellington added 0.19 percent, or 8.86 points, from Thursday to 4,717.06.
Manila was flat, edging up 4.6 points to 5,767.13.
IN THE AIR: While most companies said they were committed to North American operations, some added that production and costs would depend on the outcome of a US trade probe Leading local contract electronics makers Wistron Corp (緯創), Quanta Computer Inc (廣達), Inventec Corp (英業達) and Compal Electronics Inc (仁寶) are to maintain their North American expansion plans, despite Washington’s 20 percent tariff on Taiwanese goods. Wistron said it has long maintained a presence in the US, while distributing production across Taiwan, North America, Southeast Asia and Europe. The company is in talks with customers to align capacity with their site preferences, a company official told the Taipei Times by telephone on Friday. The company is still in talks with clients over who would bear the tariff costs, with the outcome pending further
A proposed 100 percent tariff on chip imports announced by US President Donald Trump could shift more of Taiwan’s semiconductor production overseas, a Taiwan Institute of Economic Research (TIER) researcher said yesterday. Trump’s tariff policy will accelerate the global semiconductor industry’s pace to establish roots in the US, leading to higher supply chain costs and ultimately raising prices of consumer electronics and creating uncertainty for future market demand, Arisa Liu (劉佩真) at the institute’s Taiwan Industry Economics Database said in a telephone interview. Trump’s move signals his intention to "restore the glory of the US semiconductor industry," Liu noted, saying that
NEGOTIATIONS: Semiconductors play an outsized role in Taiwan’s industrial and economic development and are a major driver of the Taiwan-US trade imbalance With US President Donald Trump threatening to impose tariffs on semiconductors, Taiwan is expected to face a significant challenge, as information and communications technology (ICT) products account for more than 70 percent of its exports to the US, Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) president Lien Hsien-ming (連賢明) said on Friday. Compared with other countries, semiconductors play a disproportionately large role in Taiwan’s industrial and economic development, Lien said. As the sixth-largest contributor to the US trade deficit, Taiwan recorded a US$73.9 billion trade surplus with the US last year — up from US$47.8 billion in 2023 — driven by strong
STILL UNCLEAR: Several aspects of the policy still need to be clarified, such as whether the exemptions would expand to related products, PwC Taiwan warned The TAIEX surged yesterday, led by gains in Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), after US President Donald Trump announced a sweeping 100 percent tariff on imported semiconductors — while exempting companies operating or building plants in the US, which includes TSMC. The benchmark index jumped 556.41 points, or 2.37 percent, to close at 24,003.77, breaching the 24,000-point level and hitting its highest close this year, Taiwan Stock Exchange (TWSE) data showed. TSMC rose NT$55, or 4.89 percent, to close at a record NT$1,180, as the company is already investing heavily in a multibillion-dollar plant in Arizona that led investors to assume
RSS