Asian stock markets are mostly trading in the red with notable losses on Friday with the overnight negative close on Wall Street on the back of some disappointing job reports hurting sentiment to a significant extent. With doubts about the pace of economic recovery surfacing again, investors seem quite reluctant to go in for any big buying, and are in fact, looking to trim down positions substantially.
The Australian market, which opened lower on negative cues from Wall Street, continues to trade weak with financial, industrial, materials and energy stocks leading the fall.
The benchmark S&P/ASX 200 index, which dropped down to around 4,673, is currently trading at 4,683, down 66.2 points or 1.4% from its previous close. The broader All Ordinaries index is down 63.8 points or 1.3% at 4,704.
In the banking space, ANZ Bank is down 2.3%, Commonwealth Bank of Australia is losing nearly 2%, National Australia Bank is down by about 1.5% and Westpac Banking Corporation is trading lower by 2.2%. Macquarie Group is also down with a notable loss.
Among top miners, BHP Billiton is trading 1.5% down and Rio Tinto is losing over 2%, while Newcrest Mining is trading modestly lower. Bluescope Steel, Fortescue Metals, Incitec Pivot and Orica are down with notable losses, while Lihir Gold is trading flat.
Among energy stocks, Santos, Oil Search, Origin Energy and Woodside Petroleum are all down in negative territory.
Shares of Macquarie Radio Network Ltd. are up nearly 15% after the company said its performance this year was significantly better than 2008-09, and should lead to full-year earnings growth of 31%. The company expects its earnings before interest, tax, depreciation and amortization for 2009-10 to be more than A$8.5 million, compared with normalized EBITDA of A$6.5 million in the prior year.
Sims Metal Management Ltd has announced a capital raising of A$475 million to fund a growth strategy. The company will raise A$400 million from a fully underwritten institutional placement at A$21 a share. A share purchase plan will raise a further A$75 million. The stock is under a trading halt.
In the currency market, the Australian dollar opened below US$0.9200, with declining commodity prices and weak equity markets forcing investors to go in for the greenback. In early trades, the Aussie was quoting at US$0.9189-US$0.9190, down from Thursday's close of US$0.9290-US$0.9295. The Australian dollar is currently trading at 0.9173 to the U.S. dollar.
With several blue chip stocks declining sharply on the back of a negative close on Wall Street overnight and a strong yen, the Japanese stock market's benchmark Nikkei 225 index tanked to a 4-month intra-day low below 9,500 on Friday. Concerns over deflation and unemployment also contributed to the weakness.
The Nikkei 225 index was down 119.88 points or 1.26% at 9,429.59 at the end of the morning session. The index had ended at 9,549.5 on Thursday, recording a loss of 127.3 points or 1.32%.
Automobile stocks were mostly down in the red. Honda Motor, Suzuki Motor, Toyota Motor and Nissan Motor were down with notable losses.
In the banking space, Sumitomo Mitsui Financial, Sumitomo Trust and Banking, Chiba Bank and Mizuho Financial traded notably higher.
Steel and non-ferrous metals stocks declined. Machinery and electric machinery stocks were also mostly down in negative territory. Shares of trading companies, insurance firms and retail houses also exhibited weakness.
Shares of electric machinery maker Sony Corp. drifted down by about 2%. The company is reportedly aiming for an operating profit margin of 5% in fiscal 2012. Though this target will be a tough one for the electronics giant, its overseas rivals are already far past that mark.
In economic news, the Bank of Japan will wrap up its two-day monetary policy meeting on Friday, and then will announce its decision on interest rates. The BoJ is widely tipped to keep rates on hold at the current record low of 0.10%, although analysts will be watching for clues on future monetary policy.
Meanwhile, the House of Representatives passed a bill to encourage lenders to freeze debt repayments by small and midsize companies after the Democratic Party of Japan and its ruling coalition partners forced a vote. The move followed approval of the measure by the lower house's Financial Affairs Committee on Thursday afternoon.
In the currency market, the U.S. dollar traded in the upper 88 yen range early Friday in Tokyo after falling to a one-and-a-half-month low overnight in New York. In early trades, the dollar fetched 88.91-88.94 yen against Thursday's close of 88.93-89.03 yen in New York and 88.90-88.92 yen in Tokyo. The yen is currently trading at 88.82 to the U.S. dollar.
The South Korean stock market is trading weak on Friday with investors treading a cautious path following a negative close on Wall Street overnight and weakness in other stock markets across the Asian region.
The benchmark KOSPI index, which very nearly rebounded into positive zone after falling to 1,612.3 in early trades, is currently down 3.5 points or 0.22% at 1,617.
Technology stocks are trading mixed. While heavyweight Samsung Electronics and Hynix Semiconductor are trading lower by 1.2% and 0.7% respectively, LG Display LCD and LG Electronics are gaining about 1.5% each.
Among shipping stocks, Samsung Heavy Industries is gaining about 2%, Daewoo Shipbuilding is up 0.7% and Hyundai Heavy Industries is trading with a modest gain, while STX Pan Ocean is down in negative territory with a sharp loss of 2.5%.
In the banking space, Korea Exchange Bank is up 0.7%. Shinhan Financial and KB Financial are trading modestly higher, while Woori Finance is exhibiting weakness.
Automobile stocks Kia Motor, Hyundai Motor and Ssangyong Motor are trading weak. Airliners, steel and telecom stocks are also exhibiting weakness. In the energy space, SK Holdings and KEPCO are trading notably lower, while S-Oil is gaining about 1%.
Among other markets in the Asia-Pacific region, Shanghai, Hong Kong, New Zealand and Taiwan are trading notably lower. Indonesia and Singapore have pared their losses and are currently trading modestly higher. Markets across the region had turned in a mixed performance on Thursday.
On Wall Street, stocks moved considerably lower on Thursday, with disappointing jobs report prompting traders to cash in on the recent strength in the markets. The major averages all closed in negative territory, backing further off of the one-year highs set on Tuesday.
The Dow declined 93.9 points or 0.9% to 10,332.4, the Nasdaq dropped by 36.3 points or 1.7% to 2,156.8 and the S&P 500 closed lower by 14.9 points or 1.3% at 1,094.9.
Major European markets moved notably lower on Thursday. While U.K.'s FTSE 100 index and the German DAX index lost 1.4% and 1.5% respectively, the French CAC 40 index declined by 1.8%.
Crude oil prices dropped more than US$2 per barrel on Thursday as a disappointing jobs report raised energy demand worries. Light sweet crude oil for December delivery dropped to US$77.46 per barrel, losing US$2.12 for the session.
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