Rating revisions send stocks tumbling

Rating revisions send stocks tumbling

TOKYO (AFP): A flurry of new ratings for Asian currencies, banks and leading companies took their toll on stock market activity yesterday, dealers said, pushing most bourses down amid a lack of strong incentives.

Japanese share prices ended 2.5 percent lower, as concern over the economic outlook grew following Moody's Investors Service's downgrading of Fuji Bank, brokers said.

The Philippines was hit by a Standard and Poor's downgrade of its long-term currency outlook from stable to negative, while lower Moody's ratings for leading Hong Kong property firms also dampened sentiment.

The lower ratings affected the region's markets amid continued financial worries and uncertainty over moves by the Indonesian leadership to peg the rupiah to a single foreign hard currency.

In Japan, "share prices accelerated their drops in late trade after Moody's downgrading of Fuji Bank, while dealers moved to sell as today was the final trading day for deliveries within February," a Nikko Securities broker said.

The key Nikkei stock average of 225 select issues on the Tokyo Stock Exchange fell 411.49 points to end at 16,198.00, a shade higher than the day's low of 16,167.33 points. The Topix index of all first-section issues fell 19.81 points to close at 1,234.77.

Elsewhere in the Asia-Pacific region:

In Hong Kong, share prices closed slightly lower amid mild profit-taking following the annual results of banking giant HSBC Holdings plc and the downgrading of the ratings outlook of two big property developers, dealers said.

The key Hang Seng index lost a mere 1.87 points, or 0.02 percent, to close at 10,683.34, after gaining 0.8 percent in the previous day's trading ahead of the release of HSBC results.

In Singapore, share prices closed 0.6 percent higher with most investors sidelined ahead of a budget to be unveiled by the government in parliament, dealers said.

The Straits Times Industrials index of the Stock Exchange of Singapore rose 9.84 points to end at 1,561.75 while the broader All-Singapore index rose 1.60 points to 414.75.

In Kuala Lumpur, share prices rose 1.3 percent following remarks by government economic adviser Daim Zainuddin that non- Malays would not be stopped from buying Malay companies, dealers said.

Under a 1970 affirmative action program known as the New Economic Policy (NEP), the government is committed to achieving 30 percent ownership in the corporate sector for ethnic Malays and other indigenous groups.

The Kuala Lumpur Stock Exchange composite index gained 9.38 points at 729. 84.

In Bangkok, share market closed 0.9 percent down but off its lows after investors stepped back into the market buoyed by Bangkok's latest pledges to the IMF, dealers said.

The Stock Exchange of Thailand (SET) composite index ended the day 4.76 points down at 517.06, while the SET 50 index closed 0.51 points weaker at 38. 61.

In Manila, share prices closed 0.7 percent lower after Standard and Poor's lowered the country's ratings outlook, amid prospects of government-ordered lower rates for two index issues.

The Philippine Stock Exchange composite index fell 15.22 points to close at 2,100.78 points.

In Seoul, share prices closed slightly lower on the Korea Stock Exchange as investors locked in profits on sharp gains in the preceding five trading days, dealers said.

The composite index closed down 2.17 points, or 0.40 percent, at 540.89.

In Shanghai, B shares, nominally reserved for foreign investors, soared 6.0 percent on strong domestic institutional buying despite weakness in Hong Kong shares, dealers said.

The Shanghai Stock Exchange's B share index rose 3.29 points to close at 58.37 points while the A share index of locally-trade stocks fell 1.94 points, or 0.2 percent, to 1,272.61 points.

In Taipei, stocks dropped 0.9 percent on profit-taking and higher interbank interest rates, with paper and transportation sectors posting the biggest losses, dealers said.

The Taiwan Stock Exchange weighted price index slid 80.54 points to 9,066. 46.

In Sydney, shares rose 0.4 percent amid keen interest by institutional investors and a strong banking sector encouraged by the ANZ Banking Group's announcement of substantial job cuts, brokers said.

The Australian Stock Exchange's key all ordinaries index rose 11.1 points to 2,666.2, off its low of 2,640.2. The All Resources index closed down 15.2 points at 1,122.9 while the All Industrials index gained 40.1 points to 4,596. 2.

In Auckland, share prices rose 0.4 percent with some buying interest emerging for leaders.

The NZSE-40 rose 8.13 points to 2,266.84.