Asia Watch

By THIS IS MONEY
Updated:

 

Today was supposed to be the day that foreign institutions would return to Japan after their holidays and buy heavily. But caution ahead of the Federal Reserve decision on interest rates tomorrow kept buyers at bay in Tokyo and some other Asian markets.

More encouraging economic news failed to inspire local retail investors, who sold big counters like market heavyweight NTT DoCoMo. The mobile phones giant fell 2.6% to 2.62m yen. The lack of support sent the Nikkei diving below 16000 at one point, closing 240.31 down at 16040.18.

Hong Kong investors decided that the Fed will not alter interest rates tomorrow, and moved in for property and financial stocks, seen as the major beneficiaries of continued stability.

The Hang Seng index reversed two days of losses and rose 81.94 to 17,521.94 led by HSBC Holdings, which gained 1.4% to HK$110, and property giant Cheung Kong Holdings, up 1% to HK$101.

Telephones group China Mobile, a recent favourite, fell 0.8% on reports that it was planning a global share placement of more than US$7.5bn (£5.03bn).

Re-ratings and upgrading of Taiwan electronic stocks continued as global sentiment on the outlook for semiconductors continues to improve. A favourite stock in morning trading was Asustek Computer which gained 2.4% to NT$211 following a report that it had been oversold. The Weighted index rose 48.81 to 8257.88.

Foreign investors came to the rescue of South Korea's telecom stocks as futuresled action by local investors saw them dumping stock. Big faller was mobile phones operator SK Telekom, which dived almost 2% on fears that it is getting ready for a cash-raising exercise.

Foreign buying of other electronic stocks such as Samsung, up 1.1%, brought support to the Composite Index, limiting the fall to 4.40 points to 723.92.

Singapore's electronics companies are attracting the attention of US brokers, and, with property stocks continuing to move ahead, the Straits Times index gained 13.84 to 2199.36.

Stand-out stocks were Chartered Semiconductor, up 50 cents or 3.5% to S$14.70, and Nat Steel Electronics, 20 cents up in early trading before falling back to Friday's close of S$5.75.

Retail investors in Thailand continued to sell down the bank and finance sectors and with no foreigners to take up the slack the SET Composite index fell 0.91 points to 318.31.

Malaysian investors decided to wait for the US interest rate picture to become clearer. The Composite index fell 8.95 points to 810.64.

In Jakarta, politics were added to Fed nerves, sending the Composite index down a further 1.35 points to 492.84 following last week's 2.3% slide.

With Australian investors already facing the possibility of another domestic interest rate increase, the Fed was the main influence on trading in Sydney, keeping buyers on the sidelines. Last week's results from airline Qantas was still pull in buyers and the stock rose 1% to A$4.10.

A court decision allowing competitors to use Foxtel's broadband network hit big shareholders in the group. Telecoms carrier Telstra Corporation, with 50%, fell four cents to A$7.30 and News Corporation, with 25%, fell 10 cents to A$22.29. The All Ordinaries was down 5.7 3297.8.

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