Asian stock markets mixed
Sunday, 3 August 2008
HONG KONG, Aug 2 (AP): Asian markets were mixed Friday as stocks in Japan and elsewhere slumped after worse-than-expected news about the US economy. China and Hong Kong shares, though, rebounded on hopes of government intervention ahead of the Olympics.
Japan's Nikkei 225 sank 2.10 per cent to end at 13,094.59, hurt also by disappointing corporate earnings. Australia, Indonesia, South Korea and Singapore markets also closed lower.
Much of the selling was linked to US government data overnight showing the country's gross domestic product grew at a 1.90 per cent pace in the second quarter, slower than many observers had expected. Investors got another piece of bad news with a second government report indicating the number of people seeking jobless benefits jumped to the highest level in five years.
China and Hong Kong markets were down early in the session as well, but they recovered some amid growing speculation that the government would move to prop up the market and the economy as the Olympic games neared.
There were unconfirmed reports that regulators may delay approvals of initial public offerings (IPO) and other stock issues, helping assuage worries over a potential glut of shares in the market - a perennial worry given the billions of previously untraded shares due to begin trading in coming weeks as lockup periods expire. Market whispers also rumored of a letup on curbs on corporate lending and other growth measures after a speech by China's president.
"On the one hand, the CSRC wants to control share sales. And there were rumours that the government also may relax controls on corporate lending," said Zhang Linchang, a strategist at Guotai Junan Securities in Shanghai. "That would boost the economy in the second half of the year, and that prospect easily excited the market."
China's benchmark Shanghai Composite Index gained 0.90 per cent to 2,801.82, while Hong Kong's blue-chip Hang Seng Index traded 0.60 per cent higher to 22,862.6. Markets in India, the Philippines and Thailand also rose.
In Japan, Sumitomo Mitsui Financial Group Inc.'s shares dove more than 7.0 per cent. The country's second-biggest bank said Thursday its profit shrank 51 per cent in the April-June quarter as it increased its provisions for borrowers that have to default on loans due to their poor financial conditions.
Japan's Nikkei 225 sank 2.10 per cent to end at 13,094.59, hurt also by disappointing corporate earnings. Australia, Indonesia, South Korea and Singapore markets also closed lower.
Much of the selling was linked to US government data overnight showing the country's gross domestic product grew at a 1.90 per cent pace in the second quarter, slower than many observers had expected. Investors got another piece of bad news with a second government report indicating the number of people seeking jobless benefits jumped to the highest level in five years.
China and Hong Kong markets were down early in the session as well, but they recovered some amid growing speculation that the government would move to prop up the market and the economy as the Olympic games neared.
There were unconfirmed reports that regulators may delay approvals of initial public offerings (IPO) and other stock issues, helping assuage worries over a potential glut of shares in the market - a perennial worry given the billions of previously untraded shares due to begin trading in coming weeks as lockup periods expire. Market whispers also rumored of a letup on curbs on corporate lending and other growth measures after a speech by China's president.
"On the one hand, the CSRC wants to control share sales. And there were rumours that the government also may relax controls on corporate lending," said Zhang Linchang, a strategist at Guotai Junan Securities in Shanghai. "That would boost the economy in the second half of the year, and that prospect easily excited the market."
China's benchmark Shanghai Composite Index gained 0.90 per cent to 2,801.82, while Hong Kong's blue-chip Hang Seng Index traded 0.60 per cent higher to 22,862.6. Markets in India, the Philippines and Thailand also rose.
In Japan, Sumitomo Mitsui Financial Group Inc.'s shares dove more than 7.0 per cent. The country's second-biggest bank said Thursday its profit shrank 51 per cent in the April-June quarter as it increased its provisions for borrowers that have to default on loans due to their poor financial conditions.