MW: December ushers in mixed mood; Honda, BHP fall
By Chris Oliver, MarketWatch
HONG KONG (MarketWatch) -- Asian stocks traded mixed to lower Monday, as investors stood mostly back amid signs the global slowdown is getting worse, with Honda leading Japanese automakers lower as the nation heads for its weakest year of domestic sales in four decades, and after data showed China's manufacturing contracted by a record amount in the past month.
Tokyo investors were also skittish after property developer Morimoto Co. filed for bankruptcy protection with $1.7 billion in debts. Shares of the firm were untraded on the Tokyo Stock Exchange.
Sydney-listed shares of BHP Billiton fell 3.2%, tracking declines in industrial metals prices late last week, and as crude-oil prices edged back down toward the $50 a barrel level in electronic trade Monday.
Regional investors largely shrugged off an upbeat U.S. session Friday that saw stocks rise in a holiday-shortened session. The Dow Jones Industrial Average ended 1.2% higher at 8,829, marking a17% rise for the week and its best five-day percentage gain since 1932.
Among currencies, the U.S. dollar weakened to 95.30 to the yen, down from 95.52 yen late Friday.
Brokers said investors were also moving to the sidelines as they await details of the recovery plan due Tuesday from the three largest U.S. automakers.
Among regional indexes, Japan's Nikkei 225 was down 1.4% in afternoon trade at 8,345.83, the Australian S&P/ASX 200 was off 1.3% at 3,694.20 and the South Korean Kospi nudged 0.3% higher to 1,078.74.
Bangkok's SET Index was up 0.5% at 403.96 and India's Sensex index was up 2.9% at 9,302.18
Shanghai's Composite Index was little changed at 1,86854, the Singaporean Straits Times Index fell 9% at 1,718.05 and the Taiwanese Taiex index climbed 1.4% at 4,524.44.
The mood in Asia was also affected by a lack of progress in the Thailand political crisis, which has shut the nation's main international airport.
"The whole image of Thailand was destroyed by this," said fund manager and financial author Marc Faber, speaking on CNBC. "If you booked holiday to Thailand over the Christmas and the New Year and you are not sure about getting in and getting out, you are not going to go, it destroys business."
Faber, who lives in Thailand, said he was stranded in Hong Kong by the airport closure.
A gauge of China's manufacturing activity in November, as compiled by brokerage CLSA Asia-Pacific Markets, marked the sharpest contraction in the history of the survey, which began in 2004. The Purchasing Managers Index fell to 40.9 in November, from 45.2 in the preceding month, its fourth straight monthly decline.
Eric Fishwick, head of economic research at CLSA, described the data as "grim" in a research note Monday, adding that it showed the global slowdown now overshadows what has until recently been a mainly domestic-led slowdown in the Chinese economy.
"Export orders will weaken further and we expect further cuts in production and employment. Costs are plummeting but the benefit to margins is being offset by output price cuts as businesses try to protect market share," Fishwick wrote.
Shares of Honda Motor Co. were down 4.9% while Toyota Motor Corp. fell 3% and those of Suzuki Motor Corp. fell 8.7%. Shares of Nissan Motor Co. fell 2.2%.
Japan's Nikkei newspaper reported over the weekend that slumping automotive sales in October and what's likely to be a soft November will put domestic sales on track for about 3.25 million vehicles this year, excluding mini vehicles, marking the lowest level in 34 years.
Automaker's shares were also hurt by a weekend newswires reports which cited a company official with Honda as saying the firm would have trouble meeting it lowered profit forecasts this year.
Among gainers, shares of NTT DoCoMo were up 3% after a Nikkei report said that service provider Willcom Inc. will launch a discount, high-speed cellular data service using DoCoMo's wireless network in early 2009.
Shares of exporter Li & Fung were down 1.6% after the company announced on the weekend would buy German fashion retailer Miles Fashion Group for $51 million.
Property stocks were among standouts in Hong Kong, with Sun Hung Kai Properties , the city's biggest developer, adding 1.7%, and Cheung Kong Holdings climbing 1.4%.
Shares of Cathay Pacific Airlines were up 3.6% after the Hong Kong-based airline said it would defer construction of a new cargo terminal at the city's airport for two years.
Light sweet crude oil futures for January were down as much as $1.12 to $53.31 a barrel in electronic trading. On Friday, the then front-month December contract closed at $54.43 a barrel.
In other U.S. action Friday, the S&P 500 Index ) rose 1%, to 896, surging 12% for the week. The Nasdaq Composite Index gained 3 points, or 0.2%, to 1,535, jumping 11% for the week.
