Investors cash in on gains
Concerns about the strength of economic recovery in the US weighed on Asian stocks yesterday July 29, with traders cashing in profits from recent gains in banks.
TOKYO: Eyes were on the world’s biggest economy after the Federal Reserve said on Wednesday that while conditions were improving, the gains were “modest”. The tepid assessment pushed most Asian markets lower, with Tokyo’s Nikkei closing down 0.59 percent, or 57.25 points, at 9,696.02.
Concerns about the US economy weighed on the greenback, with the dollar slipping against the yen, which in turn hurt Japanese exporters.
SYDNEY ended down 0.13 percent, or 5.8 points, at 4,524.1.
The losses came after four days of broad gains, which had been led by buying in banks after upbeat news from European stress tests last week and reports that planned tighter regulation of the global banking industry had been watered down.
Markets on Thursday were following a 0.38 percent drop on the Dow, which came after an anticipated Beige Book report turned out more pessimistic than the previous survey. That came on top of concerns about high unemployment and weak business confidence.
The downbeat assessment was compounded by news that orders for big-ticket items suffered the biggest drop in almost a year in June.
SHANGHAI remained positive, with the composite index ending 0.55 percent, or 14.46 points, higher at 2,648.12 as dealers hoped a recent rally, which has seen the market jump 9 percent in July, will attract more investment.
Confidence was also boosted by speculation that the government will refrain from introducing any further tightening measures in the near term.
HONG KONG: Stocks closed flat yesterday as bargain-hunters took advantage of early losses caused by a weak Wall Street lead.
The benchmark Hang Seng Index rose 2.64 points to 21,093.82.
“Consolidation looks inevitable ahead after its recent strong showing, but I think the underlying sentiment remains relatively strong, supported by the Chinese markets,” said Mark To, head of research at Wing Fung Financial.
SINGAPORE: Stocks rose to a three-month high yesterday as most markets in the region moved up after companies reported better-than-expected quarterly earnings.
The benchmark Straits Times Index closed 0.41 percent, or 12.27 points, higher at 2,997.65.
Casino operator Genting Singapore rose 1 cent to S$1.27 and container shipping firm Neptune Orient Lines gained 6 cents to S$2.08.
KUALA LUMPUR: Share prices on Bursa Malaysia continued to consolidate yesterday. Advancing counters outpaced declining counters by 386 to 345.
The FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBM KLCI) rebounded from its intra-day low of 1,353.16 to its intra-day high of 1,359.27 yesterday. It closed at 1,358.41 points, giving a day-on-day gain of 3.22 points, or 0.24 percent.
In other markets:
SEOUL closed 0.15 percent, or 2.59 points, lower at 1,770.88.
TEIPEI gained 0.18 percent, or 14.18 points, to close at 7,798.99.
MANILA closed 0.65 percent, or 22.44 points, lower at 3,429.35.
JAKARTA shares rose 1.29 percent, or 39.34 points, to 3,096.81.
BANGKOK edged up 0.81 points to 854.59.
MUMBAI rose 1.93 percent, or 34.63 points, to 17,992.00.
VIETNAM: The VN Index reversed to increase by 0.11 point or 0.02 percent to close at 491.11 points. The market liquidity remained at low level with over 35 million shares changing hands for total share value of 1.013 trillion dong.
The HNX index rose by 0.61 point or 0.4 percent to 152.99 points with total market trade of 43.3 million shares worth 1.282 trillion dong.
EUROPE: Shares closed lower, with heavyweight banks among the biggest fallers, mirroring weakness on Wall Street and erasing gains from earlier in the session following upbeat corporate earnings.
The pan-European FTSEurofirst 300 index of top shares closed 0.38 percent lower at 1,046.90 points, having earlier risen to a high of 1,060.96 points, after shares on Wall Street turned lower.
The FTSE 100 closed down 5.73 points, or 0.1 percent, at 5,313.95.
In Frankfurt, the DAX index ended at 6134.7 points, down 44.24 or 0.72 percent.
In Paris, the CAC-40 index closed at 3651.91 points, down 18.45 or 0.50 percent.
In Zurich, the Swiss market index closed at 6220.65 points, down 56.84 or 0.91 percent.
AMERICA: Stocks ended an erratic day with a modest loss Thursday as investors tried to reconcile another batch of conflicting economic signals.
The Dow fell 30.72, or 0.3 percent, to 10,467.16. Although the Dow has fallen 70 points over the past two days, it is up 7.1 percent for July with one trading day to go.
Rising stocks were narrowly ahead of losers on the New York Stock Exchange. Consolidated volume, which includes shares traded on other exchanges, was light at 4.7 billion shares, up from Wednesday’s 4.1 billion. Many investors sat out the day because of the market’s inability to settle on a direction.
Bond prices were mixed. The yield on the 10-year Treasury note, which moves opposite its price, was 2.99 percent, unchanged from late Wednesday. The 10-year yield helps set interest rates on mortgages and other consumer loans.
Traders will look next to Friday’s GDP report for a sense of how the recovery is doing. Economists surveyed by Thomson Reuters are forecasting that the GDP, the broadest measure of the economy, slowed in the second quarter to an annual rate of 2.5 percent as the government cut back on stimulus programs. That would be down from the first quarter’s 2.7 percent.
Benchmark Currency Rates
USD EUR JPY GBP CHF CAD AUD HKD
HKD 7.7667 10.144 0.0895 12.118 7.4637 7.4981 6.9869
AUD 1.1116 1.4519 0.0128 1.7343 1.0682 1.0732 0.1431
CAD 1.0358 1.3529 0.0119 1.6161 0.9954 0.9318 0.1334
CHF 1.0406 1.3592 0.012 1.6236 1.0046 0.9361 0.134
GBP 0.6409 0.8372 0.0074 0.6159 0.6188 0.5766 0.0825
JPY 86.785 113.35 135.40 83.399 83.784 78.072 11.174
EUR 0.7656 0.0088 1.1945 0.7357 0.7391 0.6887 0.0986
USD 1.3062 0.0115 1.5602 0.961 0.9654 0.8996 0.1288
Bloomberg
Tags: Investors cash in on gains
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