Asian markets get a breather from falls<\/p>\n
SINGAPORE (DPA): Led by Hong Kong and Bangkok rallies,
\nbattered Asian bourses got a breather yesterday from weeks of
\nplunging shares, but analysts predicted the regional upturn would
\nbe shortlived.<\/p>\n
Regional stock watchers expressed worries about late news that
\nHong Kong had intervened in the market yesterday for the first
\ntime in its history.<\/p>\n
Hong Kong's market shot up 8.5 percent, rallying regional
\nmarkets that have been battered for weeks by the falling Japanese
\nyen and worries that China would devalue the yuan, further
\nundermining the competitiveness of Southeast Asian exports.<\/p>\n
However, Hong Kong's rally turned out to be due to government
\nintervention in the market, a dealer revealed after the market
\nhad closed for a long weekend.<\/p>\n
Hong Kong began using its vast exchange funds to counter
\nspeculative activities, said Finance Secretary Donald Tsang at a
\npress conference. Reserves are almost US$100 billion.<\/p>\n
\"We do not tolerate attempts by speculators to manipulate our
\ninterest rates by engineering extreme conditions in the money
\nmarkets\", he said.<\/p>\n
It was the biggest daily increase on the stock market in 23
\nyears, but stock analysts labeled the intervention a dangerous
\nmove.<\/p>\n
\"It's disastrous,\" said Graham Ambrose, a stock trader based
\nin Singapore. \"It makes it look like there's not even any short-
\nselling in the market.\"<\/p>\n
He predicted the Hong Kong market would crash next Tuesday
\nafter the former colony's long weekend.<\/p>\n
Meanwhile, in Bangkok shares soared 5.5 percent in a show of
\nsome optimism over the government's new round of financial
\nrestructuring measures and the good performance of some Thai
\nfirms, analysts said.<\/p>\n
Bangkok's bourse rose steadily throughout the day after an
\nearly announcement by the Bank of Thailand (BOT) that the
\ngovernment had essentially taken over two ailing Thai banks and
\nfive finance and securities companies, forcing the previous
\nowners to write down registered capital to one satang (0.02
\ncents) per share.<\/p>\n
Takeovers<\/p>\n
The takeovers were the first step in a major financial
\nrestructuring package scheduled to be announced yesterday
\nevening, which was expected to include a series of measures to
\nbolster Thailand's faltering banks and restore liquidity to the
\nsystem.<\/p>\n
\"There was speculative trading in financial stocks going on
\nFriday, but most big investors were taking a wait-and-see stance
\non the government's financial measures,\" said Chai
\nJirasaevinoopraphan, an analyst at ABN-AMRO Asia Securities.<\/p>\n
The SET was also boosted yesterday by heavy buying of PTT
\nExploration and Production (PTTEP) stock after the national oil
\ncompany announced an 8-per-cent boost in revenues for mid-year
\n1998.<\/p>\n
Singapore stocks rose, led by Singapore Press Holdings Ltd.
\nand Sembawang Corp., as prices fell to attractive levels relative
\nto future earnings.<\/p>\n
The Straits Times Industrial Index rose 8.37 points, or 0.87
\npercent, to 974.11, the first gain in a week.<\/p>\n
The broader based DBS50 Index, which includes banks and
\nproperty stocks, fell 0.35 points, or 0.11 percent, to 319.54.<\/p>\n
Malaysian stocks were mixed amid optimism that some companies,
\nincluding Rothmans of Pall Mall Bhd., have fallen enough to
\nreflect any decline in earnings amid a slumping
\neconomy.<\/p>\n
The benchmark 100-stock Composite Index rose 1.25 points, or
\n0.38 percent, to 327.98, after tumbling 19 percent in the past
\ntwo weeks. The broader Emas Index gained 0.07 point, or 0.08
\npercent, to 84.44.<\/p>\n
The gain was led by cigarette maker Rothmans of Pall Mall
\nBhd. Consumer product companies such as Rothmans are expected to
\nweather an economic slump better than banks or real estate
\ncompanies because there is still demand for consumer products.<\/p>",
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