Monday, February 08, 2010

Foreign Market Wrap

Asian markets suffered declines Monday on uncertainty over sovereign debt in the euro zone, but bargain-buying in banks and miners limited losses in some markets.

In Tokyo, the Nikkei 225 Index plunged 105.27 points, or 1.1%, to 9,951.82, for its first finish below the psychologically important 10,000-point level in nearly two months.

Hong Kong's Hang Seng Index capsized 114.19 points, or 0.6%, to 19,550.89.

Investors worried that Greece, Spain and Portugal may not be able to bring their budgets under control amid doubts over the fragile economic recovery in the euro zone, but some analysts said markets were overreacting to such concerns.

Australian shares were boosted by materials stocks. Rio Tinto climbed 0.9% and Lihir Gold tacked on 1.8% after a string of recent losses. Banks did likewise, with Westpac Banking Corp. gaining 2.8% and National Australia Bank rising 0.6%.

In Tokyo, exporters paced the declines, with Canon losing 1.6% and Bridgestone falling 3.1%, while Panasonic slid 5.3%. Toyota Motor dropped 1.1% on concerns that it may have to also recall its popular Prius hybrid model.

Shares of Kirin Holdings slumped 7.4% with heavy trading volumes in Tokyo after the Japanese brewer said it has ended merger talks with unlisted Suntory Holdings, because of differences over whether the integrated entity would be listed.

Financial stocks were broadly higher in Tokyo after heavy losses recently, limiting the market's decline. Mizuho Financial Group rose 0.6%, Resona Holdings gained 2.3% and Nomura Holdings added 1.1%.

Banks also helped the Taiwanese market recover from losses during the volatile trading session, with Cathay Financial Holding rising 1.9% and Fubon financial Holding gaining 2.5%.

Still, financials, commodity stocks as well as property developers dropped in some other markets as concerns about Europe curbed investor risk appetite. In Hong Kong, HSBC Holdings shed 1% and energy producer Cnooc dropped 1.7%; China Vanke fell 0.9% in Shenzhen, while China Merchants Bank lost 2.3% in Shanghai.

Risk aversion continued to keep the South Korean market down as talk of receivership for Kumho Asiana Group units "increases uncertainties about the group's fate," according to one expert.

Kumho Tire fell 5.8% and Asiana Airlines gave up 5.7%.

In Singapore, Malaysian gambling concern Genting Singapore fell 2.7% in cautious afternoon trading, giving up early gains despite news that it had received its operating license from Singapore's Casino Regulatory Authority.

The opening of the casino by Genting Singapore -- ahead of Las Vegas Sands' much-delayed showpiece project in Singapore's downtown -- would bring a formal end to the Singaporean government's decades-long opposition to gambling.

In foreign exchange markets, the euro was buying $1.3695 U.S. from $1.3663 U.S. in late New York trade Friday, and 122.55 yen from 122.14 yen. The dollar was buying 89.49 yen from 89.38 yen.

Elsewhere:

The Shanghai 300 Composite Index slid 2.10 points to 3,150.99

Korea's Kospi Index was 14.33 points, or 0.9%, lower to 1,552.79

Taiwan's Taiex Index regained 3.01 points to 7,215.88

Singapore's Straits Times index gained back 10.06 points, or 0.4%, to 2,693.62

New Zealand's NZX Index surrendered 11.54 points, or 0.4%, to 3,093.45

Australia's S&P/ASX 200 added 7.30 points, or 0.2%, to 4,521.40