Asian stocks fell for the first week in three amid a deteriorating outlook for corporate profits and doubts over whether US stimulus measures will succeed in alleviating the financial crisis.
Nomura Holdings Inc, Japan’s biggest brokerage, fell 17 percent in the week on share-sale plans and as US Treasury Secretary Timothy Geithner said he needed time to work out details of a bank-rescue plan unveiled on Tuesday. Sony Corp, which makes a quarter of its sales in the US, lost 7.8 percent in Tokyo. Electronics maker Pioneer Corp dropped 13 percent in Tokyo after it widened its full-year loss forecast.
“Investors are disappointed with the lack of clarity on the US bank-rescue plan,” said Daphne Roth, Singapore-based head of Asia equity research at ABN Amro Private Bank, which manages about US$27 billion of Asian assets. “We will see more earnings downgrades going into the next few months and that’s going to drag down Asian stocks at least till the end of the first half.”
The MSCI Asia-Pacific Index slipped 2 percent to 81.75 in the past five days, following a 3.9 percent increase in the previous two weeks. The gauge is down 8.7 percent this year amid mounting signs the global recession is hurting corporate profits.
Taiwanese shares are expected to be volatile next week as the market moves closer to the nearest resistance level of around 4,700 points, dealers said on Friday.
Many investors would like to remain sidelined, watching closely how Wall Street performs amid caution over the effects of a massive US economic stimulus package, they said.
However, adequate liquidity is likely to lend support to the broader market, with foreign institutional investors continuing to rebuild their positions by targeting the bellwether electronics sector, they added.
The market is expected to pull back after jumping above the 4,700 point mark, while there may be a floor at around 4,300 to 4,400 points, according to dealers.
In the week to Friday, the weighted index rose 119.25 points or 2.67 percent to 4,590.50 after a 5.26 percent increase from a week earlier.
Average daily turnover stood at NT$73.60 billion (US$2.16 billion), compared with NT$59.76 billion a week ago.
President Securities (統一證券) analyst Steven Huang said the bourse has staged a significant comeback after investors returned to the trading floor from the Lunar New Year holiday ending on Feb. 1.
In other regional markets on Friday it was:
KUALA LUMPUR: Up 1.7 percent. The KLCI added 15.24 points to close at 909.84.
JAKARTA: Up 1 percent. The Jakarta Composite Index rose 13.32 points to 1,338.74 in thin volume. MANILA: Down 0.2 percent. The composite index gained 4.44 points to 1,919.66.
MUMBAI: Up 1.78 percent. The SENSEX index rose 168.91 points to 9,634.74.
WELLINGTON: Flat. The NZX-50 rose 0.63 points or 0.02 percent to 2,750.77.
US president-elect Donald Trump said he would “never say” if Washington is committed to defending Taiwan from China, but “I would prefer that they do not do it [ an attack],” adding that he has a “good relationship” with Chinese President Xi Jinping (習近平). “I never say because I have to negotiate things, right?” Trump said in an interview with NBC’s Meet the Press host Kristen Welker after saying he would not reveal his incoming administration’s stance on Taiwan’s defense in the event of an attack. Asked the question again, Trump, in a reference to China, said: “I would prefer that they
CROSS-STRAIT TENSIONS: MOFA demanded Beijing stop its military intimidation and ‘irrational behavior’ that endanger peace and stability in the Indo-Pacific region The Presidential Office yesterday called on China to stop all “provocative acts,” saying ongoing Chinese military activity in the nearby waters of Taiwan was a “blatant disruption” of the “status quo” of security and stability in the Indo-Pacific region. Defense officials said they have detected Chinese ships since Monday, both off Taiwan and farther out along the first island chain. They described the formations as two walls designed to demonstrate that the waters belong to China. The Ministry of National Defense yesterday said it had detected 53 military aircraft operating around the nation over the past 24 hours, as well
TECHNICAL LEAD: The US needs to boost its missile technology and build a communications network able to withstand hackers, Admiral Samuel Paparo said US Indo-Pacific Commander Admiral Samuel Paparo said the US is confident it could defeat China in the Pacific, but that technical advantage is shrinking, the Washington Post reported yesterday. Speaking at the Reagan Defense Forum on Saturday, Paparo said the US needs to maintain its technical lead over China by enhancing missile technology and building a communications network able to withstand hackers, the paper reported. Although the US is able to hit long-distance and difficult targets with its advanced cruise missile system, each launch costs more than US$1 million, he said. By contrast, drones, which are relatively cheap to build and develop, can
‘LAGGING BEHIND’: The NATO secretary-general called on democratic allies to be ‘clear-eyed’ about Beijing’s military buildup, urging them to boost military spending NATO Secretary-General Mark Rutte mentioning China’s bullying of Taiwan and its ambition to reshape the global order has significance during a time when authoritarian states are continuously increasing their aggression, the Ministry of Foreign Affairs (MOFA) said yesterday. In a speech at the Carnegie Europe think tank in Brussels on Thursday, Rutte said Beijing is bullying Taiwan and would start to “nibble” at Taiwan if Russia benefits from a post-invasion peace deal with Ukraine. He called on democratic allies to boost defense investments and also urged NATO members to increase defense spending in the face of growing military threats from Russia
RSS