Asia Down on Negative US Earnings Outlook

Asian stock markets struggled on Friday, following the negative lead from Wall Street as poor earnings outlooks for a few U.S. companies dented optimism about a recovery in the world’s biggest economy.

Japan’s Nikkei Average [JP;N225  10237.73  -176.5596  (-1.7%)   ] fell 1.7 percent, with exporters pressured by a stronger yen, while Toyota Motor skidded further after the world’s top automaker said it would extend a recall of millions of vehicles.

Advantest Corp, which supplies chip testers to chip makers such as Intel, sank nearly 9 percent after saying it now expects an annual net loss of 13.5 billion yen ($150 million), missing the market consensus for a loss of 7.2 billion yen by 16 analysts.

Nippon Steel, the world’s second-biggest steelmaker, slipped after forecasting its first annual net loss in seven years as a building slump in Japan squeezes margins.

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The Nikkei fell 178.31 points to 10,235.98. It rose 1.6 percent the previous day to end a four-day losing streak. The broader Topix declined 0.9 percent to 906.03.

Toyota erased early losses to trade flat at 3,560 yen after the world’s top automaker’s problems intensified as it announced it would extend to Europe and China a recall of millions of vehicles due to faulty accelerator pedals and floor mats. The stock has tumbled 15 percent in the past week.

Digital camera maker Canon shed 3.3 percent to 3,560 yen and Honda Motor slipped 0.5 percent to 3,125 yen.

Nintendo fell 1.5 percent to 25,920 yen after the games maker posted a 23 percent fall in quarterly profit as software sales for its DS handheld game player slowed and it cut the price of its Wii console. The company kept its forecast for a first annual profit
decline in four years.

Seoul shares fell on Friday with technology issues such as Hynix Semiconductor leading losses after a weak set of U.S. tech earnings, while Samsung Electronics dipped ahead of its results.

Shares in Korea District Heating were trading at 91,000 won ($78.99) as of 0006 GMT, versus its initial public offering (IPO) price of 45,000 won.

The Korea Composite Stock Price Index (KOSPI) was down 1.6 percent to 1,615.91 points.

Australian shares fell 1.6 percent, as poor earnings outlooks for a few U.S. companies dented optimism about U.S. economic recovery and weaker commodities prices hurt resource shares.

The benchmark S&P/ASX 200 index [AU;XJO  4569.6  -103.662  (-2.22%)   ] fell 75 points to 4,599 points. The index has fallen 7.2 percent from its high on Jan 11, hit by concerns over global growth and demand for commodities as China looks to slow its overheating economy. It is on track for its worst monthly performance since November 2008.

Shares in Macarthur Coal slumped after it said it dropped talks with Singapore-listed commodity trader Noble Group to buy its Donaldson coal unit in Australia. Macarthur was down 7.6 percent at A$9.49, while Noble shares slipped 0.7 percent in Singapore.

BHP Billiton, the world’s biggest miner, saw its shares fall 1.7 percent to A$40.02 as commodities prices softened. The miner said it approved $1.93 billion of capital expenditure to expedite growth of its Western Australia iron ore business.

Worley Parsons was down 0.3 percent at A$23.42, after winning A$700 million in LNG contracts for its joint venture with Transfield Services, which eased 1.6 percent to A$3.62, from Woodside Petroleum.

Greater China markets were mixed with Taiwan and Hong Kong tracking the regional decline while the Shanghai Composite gained 0.8 percent.

Consumer goods exporter Li & Fung soared over 10 percent in Hong Kong after announcing an outsourcing deal with Wal-Mart [WMT  52.61  -0.79  (-1.48%)   ] to supply the U.S. retailer with goods valued at $2 billion in the first year.

Chinese telecoms gear maker ZTE slipped 1.67 percent, weighed by the weak performance of technology shares on Wall Street after poor earnings and weak outlooks from Motorola [MOT  6.48  -0.92  (-12.43%)   ] and Qualcomm [QCOM  40.48  -6.72  (-14.24%)   ].

Canadian coal miner SouthGobi made a disappointing debut, tanking more than 13 percent in Hong Kong, after raising nearly $430 million dollars in its initial public offering.

The Hang Seng Index lost 0.8 percent to trade at 20,199 points.

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Taiwan stocks fell 2 percent on Friday, with AU Optronics slumping as much as 7 percent  after it reported a quarterly loss the previous day. The main TAIEX share index fell 154.37 points to 7,540.21, reversing the 1.78 percent gain in the previous session.

Taiwan Semiconductor shares bucked the downtrend to climb 1.3 percent after posting a better-than-expected quarterly profit in the previous session.

In Southeast Asia, Singapore’s Straits Times Index gave up 0.5 percent while Malaysia’s KL Composite shed 0.7 percent.

CDL Hospitality Trusts rose 2.3 percent after the property trust announced that it is buying five Australian hotels for $158 million.

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