Asian stocks mixed as Fed decision looms, traders bargain hunt


Posted at Jun 25 2008 08:03 PM | Updated as of Jun 26 2008 04:03 AM

Agence France-Presse

HONG KONG - Asian stocks were mixed Wednesday as dealers awaited an important interest rate announcement from the United States, while others capitalized on recent falls in some markets.

Shanghai was the biggest gainer, rising more than 3.6 percent as traders went bargain-hunting following recent falls, while Taipei rose 1.51 percent.

However analysts said the rebounds may be limited as oil prices continue to rise.

Hong Kong saw shares rise slightly in half-day trading after the southern Chinese city was closed in the morning as a tropical storm struck late Tuesday.

Singapore and Seoul closed the trading day slightly up, while Tokyo continued to slide and Sydney finished just off as dealers awaited the Fed interest rate decision, which is expected early Thursday.

In other markets, Bangkok recorded a 1.92 percent hike despite the government grappling with a no-confidence vote, while Mumbai and Manila both posted gains after five days of losses.

TOKYO: Share prices ended slightly lower as stocks hit a seven-week low in the morning after Wall Street skidded on news of a sharp drop in US consumer confidence.

The Tokyo Stock Exchange's benchmark Nikkei-225 index ended down 19.64 points or 0.14 percent at 13,829.92.

The broader Topix index of all first-section shares dropped 3.11 points or 0.23 percent to 1,346.08.

Buyers were scarce as the market waited for a statement from the Federal Open Market Committee later in the day for clues on prospects for interest rate rises in the United States to curb inflation.

Higher US lending rates could weigh on US shares but also boost the dollar, which would be good news for Japanese exporters, dealers said.

Toyota Motor dropped 1.3 percent to 5,160 yen and Sony shed 1.6 percent to 4,920.

HONG KONG: Share prices closed up 0.8 percent, dealers said.

The benchmark Hang Seng Index ended up 179.14 points at 22,635.16, ending four days of decline in Hong Kong.

Mainland oil producer CNOOC extended gains, with crude oil prices remaining high. The stock advanced for a third day, gaining 3.4 percent to 13.44 Hong Kong dollars.

Sun Hung Kai Properties, the city's largest developer, lost 0.1 percent to 112.30, while Sino Land shed 2.1 percent to 15.62.

Stock market operator Hong Kong Exchanges and Clearing fell 2.3 percent to 115.00, its lowest so far this year, on worries over thinning trading volumes.

SYDNEY: Shares dropped 1.0 percent, dealers said.

The benchmark SP/ASX 200 shed 52.2 points to close at 5,237.8, while the All Ordinaries fell 56.2 points to 5,362.6.

Some 1.92 billion shares worth about 7.2 billion dollars (6.9 billion US) changed hands.

BHP Billiton fell 4.7 percent to 43.72 dollars, while rival Rio Tinto lost 3.7 percent to 136.50.

The four major banks bounced back after Tuesday's falls.

"We have seen a slight reversal of the recent trend where financials were weak and resources strong," Jamie Spiteri, head of trading at Shaw Stockbroking, told Dow Jones Newswires.

Spiteri said markets remained fearful of "prolonged decay" associated with high oil prices, profit warnings and weak US economic data.

Woolworths lost 2.2 percent to close at 24.12.

Leading energy stock Woodside Petroleum gained 0.4 percent to 66.38, Santos rose 2.1 percent to 21.85 and Oil Search closed steady at 6.43.

SHANGHAI: Shares were 3.64 percent higher, dealers said.

The benchmark Shanghai Composite Index, which covers A and B shares, closed up 102.00 points at 2,905.01 on turnover of 67.5 billion yuan (9.8 billion dollars).

Financial companies and property developers remained strong, while selling pressure on heavyweight oil majors eased after two days of losses, traders said.

The Shanghai A-share Index added 3.64 percent to 3,047.53, while the Shenzhen A-share Index was up 4.82 percent to 879.24.

Baoshan Iron Steel, the country's largest steel maker, was up 5.85 percent at 9.59 yuan. Industrial and Commercial Bank of China, the country's largest lender, gained 1.54 percent to 5.28 yuan.

China Petroleum Chemical Corp, or Sinopec, Asia's top refiner, added 2.67 percent to 11.55 yuan.

The Shanghai B-share Index was up 4.06 percent to 216.11 and the Shenzhen B-share Index added 2.58 percent to 495.78.

TAIPEI: Taiwan share prices closed up 1.51 percent, dealers said.

The weighted index rose 116.94 points to finish at the day's high of 7,855.06.

The financial sector closed up 2.51 percent and the electronics sector was 1.95 percent higher.

Construction was up 4.10 percent and transportation 2.46 percent.

Whether the rebound is sustainable will depend on how Wall Street reacts to a decision by a Federal Reserve policy making meeting later Wednesday, Grand Cathay Securities analyst Mars Hsu said.

Fubon Securities analyst Michael Lin said the market is likely to face resistance at around 7,880 points if the rebound continues Thursday.

Fubon Financial rose 2.5 percent to 33.15 dollars. Taiwan Semiconductor Manufacturing Co. added 3.1 percent to 66.20 and United Microelectronics Corp. rose 1.8 percent to 16.95.

SEOUL: Share prices closed 0.4 percent higher, analysts said.

The KOSPI index ended up 6.95 points at 1,717.79 after falling to as low as 1,695.01. Volume was 340 million shares worth 4.1 trillion won (3.98 billion dollars).

The rebound followed a 3.6 percent decline over the past four sessions. The index has dropped about eight percent so far this month.

"Pessimism is dominating market sentiment due to expensive energy and inflation fears. Once oil prices stabilise, the market may see a quick recovery," said Kim Ki-Bong, an analyst at CJ Asset Management.

Samsung Electronics fell 0.61 percent to 655,000 won and Hyundai Heavy Industries fell 0.15 percent to 323,000.

SINGAPORE: Shares closed 0.83 percent higher, dealers said.

The blue chip Straits Times Index closed 24.46 points higher at 2,986.62 on weak volume of 1.02 billion shares worth 1.37 billion Singapore dollars (1.00 billion US).

City Developments was one of the biggest blue-chip gainers, rising 3.4 percent to 10.84 Singapore dollars.

DBS was up 32 cents to 19.06, UOB 40 cents higher at 18.98, and OCBC up 14 cents at 8.33.

Shipping firm Neptune Orient Lines gained three cents to 3.18, while property developer CapitaLand bucked the uptrend and fell three cents to 5.72.

KUALA LUMPUR: Malaysian share prices closed 0.8 percent higher, dealers said, with the Kuala Lumpur Composite Index rising 8.83 points to 1,209.11.

Underlying sentiment remains cautious ahead of the Fed meeting outcome, a dealer said.

The dealer said the bourse was tipped to drift in the 1200-1210 range Thursday.

Maybank added 1.4 percent at 7.25 ringgit while Tenaga rose 1.9 percent at 8.25. Resorts lost 2.1 percent at 2.75 ringgit.

BANGKOK: Thai shares closed 1.92 percent higher, dealers said.

The Stock Exchange of Thailand (SET) composite index gained 14.67 points to close at 778.42 points, while the blue-chip SET 50 index rose 11.57 points to close at 556.49.

Chai Chirasevenupraphand, market strategist at Capital Nomura Securities, said investors remain cautious concerning tension in Thai politics, rising inflation and volatile oil prices.

Bangkok Bank rose 2.00 to 116.00, while Thai Airways International edged up 0.60 to close at 21.50.

JAKARTA: Indonesian shares fell 1.0 percent, dealers said.

The Jakarta Composite Index dropped 24.01 points to 2,341.36.

"I don't see any positive factors that could drive the market higher tomorrow," a dealer said.

Coal miner Bumi Resources fell 0.5 percent at 8,400 rupiah and cellular operator Indosat fell 1.6 percent at 6,200 rupiah.

Bank Central Asia gained 2.1 percent at 2,375 rupiah and Bank Rakyat rose 1.1 percent at 4,825.

MANILA: Philippine share prices closed 1.5 percent higher after a five-day losing streak, a dealer said.

The composite index rose 35.93 points to 2,510.80 points, while the all-shares index rose 1.06 percent to 1,597.62 points.

The government's announcement that imports rose by about 11.8 percent in April "is also one of the reasons that contributed to the market's upside."

Index leader Philippine Long Distance Telephone Co. gained 1.7 percent to 2,415 pesos. Philippine National Bank also rose 1.7 percent to 30 pesos.

WELLINGTON: New Zealand share prices closed 0.51 percent lower, dealers said.

The NZX-50 gross index fell 16.89 points to 3,281.29.

Market leader Telecom fell eight cents to 3.62 dollars, but an "oversold" Fletcher Building rose 23 cents to 6.65.

Contact Energy rose six cents to 8.45 dollars after rising 16 cents Tuesday on news that Britain's BG Group had renewed its bid for Contact's Australian majority owner Origin Energy.

Infrastructure investor Infratil fell four cents to 1.86 dollars, casino operator Sky City dropped 13 cents to 3.20, and electronics maker Rakon was down 10 cents at 3.05.

MUMBAI: Indian shares rose 0.8 percent Wednesday on bargain-hunting, dealers said.

The benchmark Mumbai 30-share Sensex index closed up 113.49 points or 0.8 percent to 14,220.07, recovering from an intra-day and 13-month low of 13,731.54.

The markets opened weak but gained on fresh fund buying later.

On Tuesday the central bank raised its repo rate at which commercial banks borrow funds from the central bank to 8.5 percent from 8.0 percent with immediate effect.

It also announced a two-stage hike of the cash reserve ratio, or the amount of cash banks must hold in reserve, by 25 basis points to 8.50 percent effective July 5, and by another 25 basis points to 8.75 percent on July 19.