he stock markets across the Asia-Pacific region closed lower on Tuesday, led by China, after Wall Street ended in negative terrain overnight. A smaller-than-expected interest rate cut in China disappointed investors as economic outlook for the region further deteriorated after Japan reported the biggest ever drop in exports in November and Toyota slashed its fiscal 2009 guidance on Monday. The financial markets in Japan remained closed today in honor of the emperor's birthday.
Crude oil prices extended their decline for a second day as a deepening recession hurt energy demand. Light, sweet crude for February delivery was quoted at $39.16 a barrel, down 75 cents by 3:38 a.m. ET. The contract fell $2.45, or nearly 6%, to settle at $39.91 a barrel on the New York Mercantile Exchange on Monday.
In currency trading, the South Korean won fell 2.2% against the dollar. The won ended at 1,338.0 a U.S. dollar compared to Monday's close of 1,309.0 a U.S. dollar. The Chinese yuan weakened to 6.8538, while the Australian dollar hovered around $0.6832 in late domestic trade and the kiwi closed lower at US$0.5747.
U.S. stocks finished lower on Monday after Toyota Motor slashed its fiscal 2009 guidance, citing a faster-than-expected slowdown in the automotive market and the appreciation of the yen. Toyota expects to report an operating loss for the first time in 71 years in 2009. The Dow closed down 59.4 points or 0.7% at 8,519.7, the Nasdaq fell 32.0 points or 2.0% to 1,532.4 and the S&P 500 shed 16.3 points or 1.8% to 871.6.
The South Korean stock market closed sharply lower, led by automakers and tech stocks, as Wall Street's decline overnight dented investor sentiment. The benchmark Korea Composite Stock Price Index or KOSPI closed down 35.3 points or 3.0% at 1,144.3, extending Monday's 0.1% losses.
On the economic front, South Korea's financial watchdog said that more bank loans extended to companies turned sour in November as a deepening economic slump aggravated their financial woes. The loan default rate by companies and households stood at 1.18% at the end of the month compared with 1.14% a month ago, according to the Financial Supervisory Service. The November figure is the highest since the end of 2005 when the corresponding rate was 1.24%.
Automakers fell on worsening global demand. Hyundai Motor slumped 10.4% and its affiliate Kia Motors plunged 14.7%. The carmakers said that they have adopted an emergency management scheme at all of their plants to cope with a widening economic downturn. They have frozen salaries for office managers and cut combined sales targets this year by 12.5%.
Among tech stocks, market leader Samsung Electronics shed 6.1% and chipmaker Hynix Semiconductor plummeted 6.2%.
Among other major losers, KB Financial Group, the holding company of Kookmin Bank, fell 5.5% and top steelmaker POSCO declined 4.0%.
The Chinese stock market closed sharply lower, extending its losses for the second straight trading session, as a lower-than-expected interest rate cut disappointed investors. The benchmark Shanghai Composite Index tumbled 4.6% or 90.53 points to close at 1,897.2. Stocks fell across the board, led by banks. The Shenzhen Composite Index of China's smaller second market fell 5.6% to 587.2.
China's central bank cut interest rates late Monday for the fifth time in four months in an effort to revive economic growth amid spreading job losses and worker protests. The People's Bank of China cut the benchmark one-year lending rate by 0.27 percentage point to its lowest level since February 2004.
Banks fell on concerns over the impact of lower interest rates on their profits. Industrial & Commercial bank of China fell 2.7% and Shanghai Pudong Development Bank shed 4.1%. Elsewhere in the financial sector, China Life Insurance lost 4.8% and Ping An Insurance plunged 6.0%.
Property developers finished lower, despite a cut in interest rate, as investors locked in profits from their recent advances. Poly Real Estate dropped 6.4% and China Vanke lost 4.9%.
Airlines also closed lower on profit taking. Air China sank 9.1%, China Eastern Airlines tumbled 8.4% and China Southern Airlines fell 7.8%. Index heavyweight PetroChina shed 4.6%.
The Hong Kong stock market closed sharply lower, extending its losses for the third straight trading session, as weaker crude prices hit oil firms and as mainland stocks slid following a modest rate cut from Beijing. However, Shaw Brothers headed for a record single-day percentage gain on its impending privatization.
The benchmark Hang Seng Index closed down 401.6 points or 2.8% at 14,220.8. The Hang Seng China Enterprise Index, which tracks the overall performance of 43 Chinese mainland state-owned enterprises on the Hong Kong Stock Exchange, fell 418 points or 5% to 7,720.
Among market leaders, HSBC Holdings shed 0.5% and China Mobile plunged 1.9%. Property developers were mixed, with Sun Hung Kai Properties adding 0.4%, Cheung Kong tumbling 7.6% and Hopson Development plunging 10.0%.
The Australian stock market closed lower for the second consecutive trading session, led by big miners, on worries that a deepening recession would further hurt commodity prices. The market edged higher in early trade, despite a weak lead from Wall Street, but soon lost ground and moved into negative terrain. The benchmark S&P/ASX 200 index closed down 26.0 points or 0.7% at 3,531.4 points and the broader All Ordinaries index shed 24.1 points or 0.7% to 3,468.2.
On the economic front, the private sector research firm, the Conference Board, reported that its Leading Index for Australia declined 0.5% in October, while the coincident index, which measures current activity, increased 0.2%. October marked the second straight month of leading index declines after a 0.4% rise in August.
In the resources sector, index leader BHP Billiton plunged 3.9% and Rio Tinto plummeted 5.4%. Fortescue Metals Group rose 5.5% after losing more than 20% on Monday. Energy stocks were mixed, with Santos gaining 1.6%, Oil Search advancing 2.5% and Woodside Petroleum declining 1.8%. Among gold miners, Lihir Gold climbed 1.1% and Newcrest Mining jumped 3.3% despite weaker gold prices in Sydney.
Banks were mixed, with ANZ Banking Group edging up 0.1%, Westpac Banking Group plunging 3.1%, and National Australia Bank and Commonwealth Bank of Australia slipping 0.1% each. Bendigo and Adelaide Bank tumbled 5.4% after it said that it has raised A$175 million through a share purchase plan and an institutional placement.
HFA Holdings, an Australian hedge-fund manager, plunged 55.2% after it stopped redemptions from three of its funds, citing deteriorating liquidity.
Australia's largest energy retailer, AGL Energy, and Sydney Gas remained in trading halt pending an announcement about a material transaction.
The New Zealand stock market closed lower, reversing a major portion of Monday's gains, as Wall Street's decline overnight dented investor sentiment. The market opened weak and extended its losses after the GDP report showed contraction in economic activity for the third quarter in a row. The benchmark NZX 50 index closed down 18.0 points or 0.7% at 2,661.7, after gaining 0.9% on Monday. The broader NZX All Capital index shed 15.4 points or 0.6% to finish at 2,693.4.
Statistics New Zealand reported that the nation's economic activity, as measured by gross domestic product, contracted by 0.4% for the three months to September, marking the third straight quarter of decline. GDP had decreased 0.2% in the June quarter and 0.3% in the March quarter. The last time the economy shrank for three consecutive quarters was during the Asian crisis in 1998.
Among market leaders, Telecom declined 0.4%, Fletcher Building lost 2.1% and Contact Energy fell 2.0%. In the retail sector, Hallenstein Glasson closed unchanged, while Michael Hill International rose 1.8% and Pumpkin Patch pared sharp gains in early trade to finish up 1.0%. The Warehouse Group shed 1.4%.
The other major losers included Auckland International Airport, Fisher & Paykel Appliances and Ebos Group 2.4% each, Air New Zealand 4.5%, Cavalier 5.6%, Sanford and ING Property Trust 3.1% each, Property for Industry 2.8%, Port of Tauranga 2.6%, Pike River Coal 2.2%, Telstra 2.7%, Vector 2.3%, and Westpac Banking Corp. 3.8%.
Among major gainers, AMP NZ Office Trust jumped 3.1%, Infratil rose 2.4%, SkyCity climbed 2.7%, and Steel and Tube Holdings advanced 1.7%.
Other Asian markets:-
Taiwan's Taiex plunged 2.9% to 4,405; Indonesia's Jakarta Composite Index slipped 0.1% to 1,343; Malaysia's KLCI closed down 2.3 points at 871; Singapore's STI shed 1.2% to 1,144 and India's Sensex was losing 2.1% to 9,724 at 4:28 a.m. ET.
For comments and feedback: contact editorial@rttnews.com Copyright(c) 2008 RealTimeTraders.com, Inc. All Rights Reserved
