Asian Markets Mixed; Sumitomo, Bharti in Deals

123jump.com Staff
15 Feb, 2010
New York City

Markets in Japan, India and Australia were on the defensive after Japan reported a sharp drop in prices. Sumitomo offered 55% premium to increase its stake in Jupiter Telecom. Resurgent inflation in India dragged market indexes. Bharti Airtel drops on expensive bid of $10.7 billion for African assets of Zain.

[R]9:40 AM New York – Markets in Japan, India and Australia were on the defensive after Japan reported a sharp drop in prices. Sumitomo offered 55% premium to increase its stake in Jupiter Telecom. Resurgent inflation in India dragged market indexes. Bharti Airtel drops on expensive bid of $10.7 billion for African assets of Zain.[/R]

Asian markets traded mixed on the first day of the Lunar New Year. Markets in Shanghai, Hong Kong, Malaysia and South Korea were closed.

Commodities trade lower on the worries that the recent lending curbs in China and higher bank reserve demands are likely to dampen the demand. Copper, gold and zinc traded lower in Tokyo and Sydney trading.

Economic growth in the fiscal third quarter to December was 4.6% annual rate in Japan, faster than the estimate of 3.5% to 3.7%. However, price deflator declined 3%, the largest price decline in nearly three decades.

Sumitomo Corp offered higher price for a cable operator Jupiter Telecom Co. trumping the bid from KDDI Corp. Sumitomo said it is prepared to offer 122 billion yen or $1.3 billion to acquire 875,834 for 139,500 yen each. The company plans to increase its stake to 40% to from the current 27.4%.

Wholesale inflation perked up in January in India. Food prices increased at the sharpest pace in January since October 2008 on the record weak monsoon since 1972.

India based Bharti Airtel Ltd is in exclusive to talks to acquire African mobile communication business from Kuwait based Mobile Telecom or Zain. The company may pay as much as $10.7 billion for 42 million subscribers in Africa or nearly $250 per subscriber.

Bharti Airtel stock declined nearly 9% on the worries that the expensive acquisition will dilute the earnings and may be difficult to digest.

BHP Billiton chief executive Marius Kloppers in an interview that iron ore prices negotiations are likely to lead to a price increase to Chinese steelmakers. Analysts are expecting prices to increase between 33% and 40%.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 78.89 or 0.78% to 10,013.30. ASX 200 index in Australia decreased 16.60 or 0.36% to 4,545.50. The Markets of Hong Kong, China and Malaysia were closed today.

The SET index in Thailand closed lower 8.94 or 1.28% to 689.09 and JSE Index in Indonesia decreased 16.68 or 0.66% to 2,517.46. The Sensex index in India decreased 114.24 or 0.71% to 16,038.35.The Market of South Korea was closed today.

Europe Markets Review

In London FTSE 100 Index traded higher 46.55 or 0.91% to 5,189.0, in Paris CAC 40 Index increased 30.65 or 0.85% to 3,629.72 and in Frankfurt DAX index traded higher 36.92 or 0.67% to 5,537.31. In Zurich trading SMI increased 31.44 or 0.49% to 6,447.64.

ASX 200 Index Movers

Energy World Corp Ltd led the decliners in the ASX 200 index of 6.9% followed by losses in MacArthur Coal Ltd of 5.0%, in Crane Group Limited of 4.9%, in West Australian Newspapers Holdings Ltd of 4.4% and in Healthscope Limited of 4.3%.

AWB Limited led gainers in the ASX 200 index with a rise of 9.0% followed by gains in Hills Industries Limited of 3.4%, in Bendigo and Adelaide Bank Ltd of 3.0% and in CSL Ltd of 2.8%.

Nikkei 200 Average Movers

Shinsei Bank Ltd led the decliners in the Nikkei 225 index of 6.7% followed by losses in Nippon Meat Packers Inc of 6.1%, in Sumitomo Osaka Cement Co Ltd of 5.6%, in Toho Zinc Co Ltd of 3.4% and in Fuji Electric Holdings Co Ltd of 3.3%.

Nisshinbo Holdings Inc led gainers in the Nikkei 225 index with a rise of 4.3% followed by gains in Meidensha Corp of 3.3%, in Credit Saison Co Ltd of 2.4% and in Kawasaki Kisen Kaisha Ltd of 2.3%.