U.S. economic data rattles Asia stocks
U.S. economic data rattles Asia stocks
Christopher Kaufman, Reuters, Singapore
Asian stocks fell on Friday and the dollar was under pressure
as traders digested sharp losses on Wall Street and the dreary
economic reports and corporate news that triggered them.
But falls were less dramatic than in U.S. markets, and some
Japanese financial stocks nudged higher.
The Nikkei average finished down 83.85 points or 0.86 percent
at 9,709.66, but the broader TOPIX index fared better, ending the
day down 0.29 percent at 955.81 after flirting with positive
territory.
"The market here is now so dependent on the U.S. market," said
Masatoshi Sato, a manager at Mizuho Investors Securities' equity
division.
Sato said investors were waiting for U.S. jobs data for July,
due at 12.30 GMT (07.30 p.m Jakarta time).
Consumer electronics giant Sony Corp, which earns two-thirds
of its revenues overseas, was down 3.33 percent at 5,220, while
rival Sharp slumped 5.77 percent to 1,324.
Other key Asian markets were lower, except for Taiwan's TAIEX,
which was up a fraction on state buying.
The dollar was pressured by sporadic Japanese exporter
selling, falling as low as 118.79 yen. By 06.55 GMT (01.55 p.m
Jakarta time) it was at 119.09 yen and bought a euro for 0.9859
cents.
Reports showing the U.S. manufacturing sector grew at a much
slower-than-expected pace in July and construction spending fell
sharply in June were the latest blows to the economic recovery.
A grim outlook from software maker Adobe Systems Inc. and a 41
percent drop in quarterly earnings for oil giant Exxon Mobil
Corp, spurred sellers.
The blue-chip Dow Jones industrial average sagged 229.97, or
2.63 percent, to 8,506.62, while the Standard & Poor's 500 Index
dropped 2.96 percent to 884.66. The Nasdaq Composite Index was
off 3.63 percent, at 1,280.
"I was feeling reasonably good that we were making a bottom
and now this has made me concerned," said Philip Dow, director of
equity strategy at RBC Dain Rauscher. "I really think that if you
are not concerned about the economic reports then there might be
something wrong with you."
Corporate ethics were in focus again after the FBI said on
Thursday it arrested two former executives of bankrupt telecoms
firm WorldCom Inc. for their role in the US$3.85 billion
accounting scandal shaking confidence in corporate America.
European shares were expected to open flat to weaker, after
Wall Street failed to recover from its sharp losses after
Europe's close on Thursday and European corporate results gave no
clear reason to buy.
NYMEX crude extended New York falls, blamed on the depressing
economic data, with only a minor uptake coming from renewed
Israeli-Palestinian violence.
By 07.05 GMT (02.05 p.m Jakarta time), front-month September
crude was at $26.37 per barrel on ACCESS, down 10 cents from New
York, having been as low as $26 a barrel earlier in the morning.
State buying in Taiwan helped stocks close flat, with the
TAIEX ending up 0.09 percent at 4,920.89 in thin volume.
Hong Kong's key share index headed into the afternoon led
lower by blue chip telecom and technology stocks.
The benchmark Hang Seng Index was down 1.51 percent at
10,036.76 after dipping below the psychologically important
10,000 mark.
Singapore's Straits Times Index was off its lows heading into
the afternoon, down 0.17 percent at 1,514.59, and Australia's S&P
ASX 200 had also recovered some ground to finish 0.76 percent
lower at 3053.9.
South Korean shares closed down one percent at just above 700
with top auto and electronics exporters bearing the brunt of the
selling. The KOSPI finished 1.01 percent lower at 700.68 points.