Japan Ends Flat, South Korea Gains

Ivaylo
20 Feb, 2007
New York City

The market in Japan closed flat while South Korea rose for a fifth straight session Tuesday as some of Asian biggest markets took the day off for the Lunar New Year holiday. Many markets around the region are still closed for Lunar New Year celebrations. Markets were closed Tuesday in Hong Kong, Singapore and Malaysia and will reopen Wednesday. Markets in China and Taiwan are closed for the week.

[R]8:30AM Japan finished flat on Tuesday while South Korea advanced.[/R]
Asian markets ended mixed on Tuesday. Japanese benchmark index Nikkei 225 closed almost flat, down 0.01% at 17,939.12. Trading was wary ahead of a closely watched decision on interest rates by the Bank of Japan, expected Wednesday. Mitsubishi UFJ Financial Group led decliners in banking shares on concerns the Bank of Japan may hold off on making any changes to its key interest rate at this time. Shares of Mitsubishi UFJ shed 1.3%, while Mizuho Financial Group dipped 0.2%.

Nippon Steel advanced 2.4%, however, on hopes of additional consolidation within the sector after the company announced on Monday it had raised its stake in a smaller steel maker. Sapporo Holding declined 1.6%. The third-biggest beer maker in Japan is facing a $1.3 billion takeover approach from U.S. equity fund Steel Partners.

South Korean Kospi index rose 0.29% to 1,452.96. Steel maker Posco finished up 2.4% on a share buyback and reports late in the session that Standard & Poor''s lifted its credit rating on the company. Australian benchmark index S&P/ASX 200 fell 0.01% to 5,989.70.

[R]6:30AM European markets were lower on Tuesday on weak real estate stocks.[/R]
European equity markets declined on Tuesday. By mid morning, Frankfurt Xetra Dax shed 0.1% to 6,978.84, the CAC 40 in Paris lost 0.3% to 5,723.81, while London FTSE 100 was flat at 6,444.3.

Advancers

EMI added 7.3%. EMI announced it received an approach from Warner. EMI said there was no certainty the approach would lead to a takeover offer. Some auto makers gained. Volkswagen, the German carmaker, gained 3.5% as expectations were raised that the company would lift its dividend when it posts its full-year numbers later in the session. Volvo added 1.8% after it agreed to buy Nissan Diesel to add production in Asia, the world fastest- growing economic region. Shareholders in Nissan Diesel, fourth-largest truck maker in Japan will receive 540 yen a share. That is 22% higher than the closing price yesterday. Volvo already owns 19% of Nissan Diesel.

Decliners

Real Estate companies dipped after Land Securities of the UK posted a 2.2% increase in its net asset value per share, but said higher interest rates were beginning to have a cooling effect on the property market. Shares in Land Securities shed 2.3%, while Unibail of France lost 1.7% and Rodamco Europe, listed in Amsterdam, dropped 0.5%. Oil companies retreated after crude prices fell by around 1% overnight. Total of France was down 0.5%, while Norwegian Statoil lost 0.6%.

Crude oil and gold

Oil prices gained on Tuesday after shedding 1% a day earlier as traders were torn between supply anxieties in Nigeria and the nearing end of winter oil demand in top consumer the United States. Crude oil also recovered some of the losses on Monday, trading at $58.67 a barrel on the Globex electronic platform. London Brent crude rose 31 cents to $58.45 a barrel. The New York Mercantile Exchange did not issue a settlement price on Monday as its trading floor was closed for the Presidents Day holiday. Gold for immediate delivery fell $1.90, or 0.3%, to $668.85 an ounce in early trade in London.

Currencies

The euro bought $1.3141 in morning European trading, slightly up from its level of $1.3135 in New York late Monday, hitting six-week highs on worries about nuclear issues and Iran. The British pound rose to $1.9489 from $1.9453. The dollar bought 119.94 yen, compared with 119.56 yen Monday.

[R]5:30AM Gold rises, silver and platinum decline Tuesday on weaker dollar.[/R]
Gold for immediate delivery rose as much as 90 cents, or 0.1%, to $671.65 an ounce, and traded at $671.05. Gold yesterday rose as high as $673.55, its highest since July 17. Some financial markets in Asia, including China, are closed for the Lunar New Year holidays. Silver dropped 4 cents to $13.965 an ounce. Palladium declined $2 to $338.50 and platinum slipped $2.50 to $1,213.50. Copper on the London Metal Exchange rose as much as $40, or 0.7%, to $5,845 a metric ton in after-hours trading and was at $5,845. Prices have gained 19% in the past year

Crude oil for March delivery was at $58.56 a barrel, up 3 cents, in after-hours electronic trading on the New York Mercantile Exchange. The more active April contract dropped 2 cents to $59.21 after falling 1.1% yesterday. Brent oil for April settlement rose 9 cents, or 0.2%, to $58.23 a barrel on the ICE Futures exchange in London. Gasoline for March delivery was at $1.6499 a gallon in after-hours trading, after gaining 0.1% to $1.6471 yesterday.