Markets Close Lower in Asia

Ivaylo
17 Oct, 2001
New York City

Stock markets in Japan and South Korea declined on Tuesday as investors cashed in recent advancers such as Honda Motor Co. and Toyota Motor Corp. A stronger yen also helped as well as growing worries over North Korea nuclear scare and upcoming Asian earnings. A jump in crude oil prices overnight weighed on airlines and rubber companies in Japan. Markets in Seoul fell after hitting an intraday low on local news reports that North Korea may be preparing for another nuclear test.

[R]7:30AM Asian markets close mostly lower as recent gains were erased.[/R]
Asian markets ended lower on Tuesday. Japan''s Nikkei 225 index lost 0.49% to finish at 16,611.59. All Nippon Airways fell 1.89%, while tire maker Bridgestone dropped 1.38%. Sony, which earlier Tuesday said that it may lower its fiscal-year earnings forecast due to battery recall problems, plunged 1.84%. Nissan Motor Co shares fell 1.9% after Deutsche Securities lowered its rating, citing a slower-than-expected turnaround in operations.

The Korea Composite Stock Price Index, or Kospi, fell 0.4% to 1,351.30. LG Electronics, South Korea largest home appliance manufacturer by revenue, which initially advanced slightly on better-than-expected third-quarter earnings, closed 0.2% lower.

Hong Kong Hang Seng Index closed flat, adding 0.03% at 1,8014.84. In Taiwan, shares shed on profit-taking after they hit in the previous session a five-month high. The Weighted Price Index of the Taiwan Stock Exchange sank 1% to close at 7,075.13.

Australia S&P ASX/200 closed down 0.6%, easing back from a five-month high Monday. Shares traded in New Zealand rose 0.3%. Singapore''s Straits Times Index fell 0.9%. Australian-listed Woodside Petroleum''s shares advanced 1.3%.

Japanese government officials stated Tuesday they welcomed the decision by the central bank of Russia to begin holding some of its foreign exchange reserves in yen.

[R]6:30AM European markets end winning streak due to emerging profit-taking.[/R]
European markets were lower on Tuesday. By mid morning, the FTSE 100 in London slipped 0.2% to 6,157.8, Frankfurt Xetra Dax shed 0.8% to 6,137.87, and the CAC 40 in Paris lost 0.7% to 5,324.88.

Advancers

There were only a few advancers on Tuesday. Total of France gained 1% while in the UK BP added 1.7%.

Decliners

Spanish oil company Repsol fell 5.5% in spite of Sacyr Vallehermoso, the construction group, announcing it had built a 9% stake over recent sessions and wanted to extend its holding to 15%.

JP Morgan reduced its rating on the Spanish retail banking sector to underweight, with downgrades for both Banesto and Banco de Sabadell, which fell 1.5% and 1.5%, respectively.

BBVA, which remains the top pick of JP Morgan in the sector, nevertheless fell 1.8% after Deutsche Bank downgraded it from buy to hold. Santander, which was among the top picks of both JPM and Deutsche, shed 2%. Natexis, the securities devision of French mutual lender Banques Populaires, fell 4.1%.

Oil and gold

Oil prices rose above $60 a barrel Tuesday as traders are awaiting an OPEC meeting later in the week for a clearer price direction. Cold weather forecasts in the U.S. also prompted traders to bid up the cost of home-heating fuels. Light, sweet crude for November delivery rose 24 cents to $60.18 a barrel in Asian electronic trading on the New York Mercantile Exchange

Gold traded in London at $594.90 a troy ounce, up from $592.55 late Monday.

Currencies

The U.S. dollar was lower against most other major currencies in European trading Tuesday morning. The euro was quoted at $1.2531, unchanged from late Monday in New York. The British pound was quoted at $1.8666, up from $1.8612. The dollar bought 118.63 Japanese yen, down from 119.11.

[R]5:00AM Gold and silver futures advanced sharply on Monday, on dollar weakness.[/R]
December gold surged $5.80 to close at $598.50 a troy ounce on the NYME, while December silver added 23 cents to $11.91. January platinum rose $8 to $1,091.30 an ounce and December palladium gained $8.60 to $324.55 an ounce. High-grade copper futures finished sharply higher Monday, drawing some support from strength in other metals. The most active December copper contract advanced 16.75 cents to settle at $3.5810 per pound.

November crude oil futures gained $1.37 to end at $59.94 a barrel. The contract expires Friday. The November heating oil contract moved up 3.87 cents to $1.7585 a gallon. The November gasoline contract settled up 2.33 cents at $1.4917 a gallon. November natural gas gained 78.5 cents to close at $6.444 a million British thermal units.

On the New York Board of Trade, December Arabica coffee futures closed 2.15 cents lower at $1.0190 a pound, with March down 2.10 cents at $1.0590. The most-active December contract settled down $10 at $1,406 per metric ton. March futures on raw sugar in foreign ports ended 0.58 cent higher at 11.71 cents a pound.