Japan Ends Weak, China Bucks Trend

Ivaylo
13 Mar, 2007
New York City

Asian-Pacific markets closed mostly lower Tuesday with a moderate decline in Japanese stocks as investors sold blue-chip exporters such as Sony and Toyota. Japanese export-related stocks plunged after the yen gained against the dollar in U.S. trading, reflecting a reduced desire for risk. In Hong Kong shares finished lower as profit-taking offset stronger-than-expected results. In China, the benchmark index bucked the overall downtrend and advanced.

[R]9:00AM Asian markets finished largely lower Tuesday with Japan down and China up.[/R]
Asian markets finished mostly lower on Tuesday. In Tokyo, the benchmark Nikkei 225 index shed 0.66% to end at 17,178.84. Decliners included Sony, falling 2.1%, and Toyota Motor, which dipped 1.1%. Nikko Cordial was a bright spot, surging 6.1% as the Tokyo Stock Exchange decision Monday to keep the issue listed boosted expectations that Citigroup will make a better takeover offer. Hitachi Ltd rose 0.8% after announcing it would sell a motor-making subsidiary.

In Hong Kong, the benchmark Hang Seng Index fell 0.6% to finish at 19,333.14. Large-cap developer Sino Land closed 2% lower on concerns it is paying too great a price for one of the sites under the joint venture with unlisted Nan Fung Development. Sun Hung Kai Properties added 0.7%, while Henderson Land edged 1.4% higher. Hang Lung Properties advanced 1.9%. China Mobile, the largest mobile operator by subscribers in the world, shed 1.7% on profit-taking after advancing 4.3% on Monday.

Elsewhere, Australian S&P/ASX 200 finished 0.44% lower at 5,865.00 and South Korean Kospi closed 0.37% lower at 1,436.05. Taiwan Weighted Price Index ended 0.72% higher at 7,684.00. China leading benchmark index, the Shanghai Composite, swung from a weaker start, adding 0.33% to end at 2,964.79.

[R]8:00AM NY-7:00PM Mumbai Sensex ends higher Tuesday on strong IT, metals.[/R]
The Sensex on BSE ended 80.35 points higher, or 0.62%, at 12,982.98. The market-breadth was positive as there were two advancers for every decliner. For 1,739 stocks that advanced on BSE, 851 declined and 85 remained unchanged. Of the 30 stocks in the Sensex, 23 advanced, sic declined and one was unchanged. The turnover on BSE was Rs 4,193.74 crore, compared with Rs 3,417.17 crore on Monday. The turnover on NSE was Rs 8,132.81 crore, lower than Rs 8,331.19 on Monday.

Economic news

Finance Minister P Chidambaram today said the RBI and the Indian Banks Association have no objections on raising bank credit to minorities but he added that both sides need to reconcile their differences of opinion before a policy position is reached at. The Finance Ministry was engaged in consultations with the IBA and the RBI to smooth out some differences on raising loans to minorities

Latest data released today showed that 16 out of 17 industry groups registered output growth in January 2007. Manufacturing is leading, but unlike last year mining and electricity, too, have started making significant contributions.

Trading highlights

MindTree Consulting was the most-active stock with a turnover of Rs 687 crore followed by Tech Mahindra and Idea Cellular. MindTree Consulting, surged 12.7% to Rs 879, extending a sharp surge of Monday.

Advancers

It stocks led the gainers on intense buying. Satyam was the most prominent gainer, up 2.2% to Rs 452.2. TCS was 2.1% to Rs 1,264.5. Wipro was up 1.6% to Rs 582. The largest private steel manufacturer in India, Tata Steel, was 1.9% higher to Rs 444.5. Cipla and ONGC gained 1.8% each at Rs 237 and Rs 807, respectively, while Larsen & Toubro was up over 1% to Rs 1,530 and Tata Motors was 1% higher at Rs 773. Index heavy Reliance Industries finished almost flat, up 0.1 to Rs 1,326.9.

Decliners

Hindustan Lever led the decliners, down 2.1% to Rs 181.2. It had slipped to a low of Rs 179.80. Reliance Energy slipped 1.7% to Rs 466, and Ranbaxy declined 1% to Rs 321. It large-cap Infosys was off 0.5% to Rs 2,105.65. Ranbaxy fell after Pfizer, the world biggest pharmaceutical company, sued Ranbaxy to block a generic form of the cholesterol and blood pressure medicine Caduet. Bharti Airtel finished 0.6% lower at Rs 765.2.

[R]7:00AM European markets were lower in early trade Tuesday on selling pressure.[/R]
European markets were lower on Tuesday. The German DAX 30 index fell 0.4% at 6,690.70, the French CAC 40 dipped 0.2% at 5,483.83 and the U.K. FTSE 100 lost 0.4% at 6,208.00.

Advancers

Man AG advanced 2.3% after it was upgraded to buy from neutral at UBS, with the broker also raising its price target. Antofagasta also added, up 0.6% in London after reporting an 87% jump in net profit to $1.35 billion due to record copper prices and higher-than-expected production for the year.

Altadis SA gained 2.9% after it was reported that Imperial Tobacco contacted the Spanish cigarette maker to see if it would be interested in a merger.

Decliners

U.K. brewer SABMiller fell 3.5%, leading decliners on the benchmark index, after the company announced operating profit will be hurt by around $80 million in the financial year that is going to start on April 1. Swisscom lost 1.8% after posting a 21% drop in 2006 net income to $1.3 billion as revenue fell 0.8%. Swisscom on Monday offered to buy Italian rival FastWeb for around $4.9 billion.

Michelin shares lost 1.4% after announcing it plans to issue between 610 million and 700 million euros of 10-year, zero-coupon convertible bonds. Michelin stated it is trying to take advantage of favorable market conditions and diversify its sources of funding.

Oil and gold

Oil prices bounced back Tuesday after a big decline a day earlier as traders reassessed the outlook for energy demand and supplies. Light, sweet crude for April delivery on the New York Mercantile Exchange gained 53 cents to $59.44 a barrel by noon in Europe. Brent crude rose 60 cents to $61.34 a barrel Tuesday on London''s ICE futures exchange. Gold traded at $649.60 an ounce on Tuesday, down $3.50 an ounce from the close of $653.10 on Monday.

Currencies

The euro edged lower against the U.S. dollar on Tuesday. The euro bought $1.3160 in morning European trading, down from $1.3187 in New York late Monday. The British pound slid to $1.9285 from $1.9318. The dollar was lower against the Japanese yen, however, slipping to 117.41 from 117.61.

[R]5:00AM Gold declinedon Monday, while silver and copper advanced.[/R]
April gold shed $1.70 to $650.30 a troy ounce on the New York Mercantile Exchange. May silver gained 11.5 cents to end at $13.085. April platinum settled up $10.10 at $1,213.80 an ounce, while June palladium lost 40 cents at $356 an ounce. The most active May copper contract ended up 6.50 cents at $2.8490 per pound.

The April crude oil declined $1.14 to $58.91 a barrel after hitting an intraday low of $58.60 a barrel. April heating oil shed 2.99 cents to $1.6823 a gallon, while April gasoline advanced 0.84 cent to close at $1.9105 a gallon after rallying to $1.9300 a gallon, more than six cents off its intraday lows. April natural gas dipped 17.1 cents to finish at $6.912 per million British thermal units.

On the New York Board of Trade, Arabica coffee futures finished lower as the May contract closed 0.70 cent down at $1.1180 a pound. Futures on raw sugar in foreign ports ended down 0.16 cent at 10.36 cents a pound.