Asia Tumbles Again

Ivaylo
07 Jun, 2006
New York City

Japanese and mainland Chinese stocks suffered the heaviest losses. The Nikkei dipped 1.88%, its lowest finish in more than six months. In Hong Kong, the Hang Seng index ended 0.98% down. Elsewhere in the region, South Korea''s Kospi Index shed 2.67%, the Taiwan Weighted Index declined 1.75% and Singapore''s Straits Times Index lost 1.42%. Australia''s S&P/ASX 200 eased 0.21%.

[R]7:15AM Asian stocks finish lower on U.S. interest rate concerns.[/R]
Asian markets finished lower. The Nikkei fell 1.88% to 15,096.01. Banks and heavy-industry shares were among the biggest decliners in the Tokyo session. Resona Holdings dropped 4.48%. Kawasaki Heavy Industries fell 4.29%. Machinery maker Komatsu plunged 6.5% after KBC Securities lowered its rating to sell from buy on worries that the stock was overvalued. Exporters also dived on concerns that U.S. inflation could hurt overseas demand for Japanese products. Toshiba Corp shed 3.49% and Sanyo Electric Co fell 2.3%. In Hong Kong, the Hang Seng benchmark finished down 0.98%, to 15,816.55. Property shares widened their losses as U.S. interest rate expectations impacted the dollar-pegged economy. Sinopec Shanghai Petrochemical lost 8.97% after parent company Sinopec rejected reports it intended to buy out its subsidiary''s Shanghai-listed shares. The Bank of China, having advanced every day since its debut on the exchange on Thursday, was also down 1.4%. It said that an over-allotment option in its IPO had been exercised, making possible the sale of 3.84 billion additional shares at the initial price of HK$2.95. The move raised an additional $1.42 billion, putting the total value of the IPO to more than $11 billion.

[R]6:30AM European stocks continued the decline in mid morning trade.[/R]
European markets were lower in mid morning trade. London FTSE 100 lost 20 points, or 0.4% to 5,649.4. The Xetra Dax fell 9.1 points, or 0.2%, at 5,502.81 and the French CAC 40 dropped 14.4 points, or 0.3%, at 4,783.48. On the corporate front, Novartis gained 0.1%, after the Swiss pharmaceutical company launched a $569m bid for the UK biopharmaceutical, NeuTec Pharma. The move plans to strengthen its infectious details portfolio. Neutec traded 14.6% higher. Societe Generale lost 0.2%, after the French bank announced it was buying a 10% stake in Rosbank of Russia. The deal means that Rosbank will delay its planned flotation indefinitely.

France Telecom said that it intends to sell its majority stake in its directories business Page Jaunes as a non-core business. The sale of France Telecom’s 54% stake was expected to raise more than £3bn. Page Jaunes was the strongest gainer from the FTSE Eurotop 300, up 2.8 % higher, while France Telecom fell 0.2%.

Crude oil traded 26 cents lower at $72.24 a barrel by 0232 GMT, after shedding 10 cents on Tuesday. London Brent declined 23 cents to trade at $70.58. The dollar gained against the euro. In morning European trading, the euro purchased $1.2790, down from $1.2834 in New York on Tuesday. The British pound slid to $1.8573 from $1.8608 in New York, while the dollar advanced to buy 113.40 Japanese yen from 113.14 the day before.

[R]5:00 AM Gold and other precious metal fall on Tuesday.[/R]
August gold shed $14 to $634.70 an ounce on NYME. July silver declined 45 cents to $11.845 an ounce and July platinum ended down $22.60 at $1,235.90 an ounce. September palladium finished $12.95 lower at $351.05 an ounce. July copper contract closed 11.15 cents lower at $3.4895 per pound.

The July crude oil settled at $72.50 a barrel, down 10 cents, after plunging to $71.35. The July gasoline contract advanced 1.46 cents to $2.1788 a gallon after diving to $2.14 a gallon. On the New York Board of Trade, July Arabica coffee finished 2.35 cents lower at 96.10 cents a pound and September lost 2.35 cents to 98.90 cents a pound. July futures on raw sugar in foreign ports ended down 0.30 cent at 15.09 cents a pound while October lost 0.27 cent to 15.46 cents a pound.