Asia Watch

By THIS IS MONEY
Updated:

 

Speculation that Rupert Murdoch's News Corporation and Kerry Packer's PBL were set to dump their pay TV partner and throw in their lot with Cable & Wireless Optus sent the British-controlled telco's shares sharply higher today.

Murdoch's flagship newspaper The Australian today carried an unsourced report claiming that News and the Packer family's PBL would quit the Foxtel joint venture and join with rival Cable & Wireless Optus.

News and PBL each hold 25% of Foxtel, while the other 50% is held by former monopoly Telstra. The two media heavyweights have been unhappy for some time with the shareholding structure at Foxtel, and are allegedly unhappy with the venture's future strategy.

Optus shares jumped more than 4% to a high of A$4.60 in a weaker market, while the report was also positive for shares in PBL, up around 3% to A$12.85. News shares moved lower, while Telstra continued to languish, down another eight cents to A$6.57.

The pay-TV rumours came amid a slightly weaker Australian market, the All Ordinaries off 1.6 points at 3102.9.

Exerting strong downward pressure on the index was London-listed resources giant Rio Tinto, whose shares followedyesterday's London lead and slid 5%.

Tokyo made good gains, boosted by a combination of higher US markets and opinion polls showing a likely victory for the ruling coalition in Saturday's election. The Nikkei 225 Average closed up 316.20 to 16,907.55.

Information and telecoms shares were in demand, with all three NTT companies making gains and Hitachi up 1.5% after announcing a tie-up with US giant IBM. Other gainers included Sony, up 2%, and Fujitsu, which put on 5.3%. The optimism did not extend to Osaka, where trading was sluggish on the second day's trading of the new Nasdaq Japan.

Two of the eight listed stocks, job agency Creek and River and systems provider Xnet, fell by more than 13% although software firm Digital Design went against the trend, spiking 20%.

Hong Kong shares were firmer, the blue-chip Hang Seng up 110.49 to 16,377.96 by the mid-session break. Market sentiment mirrored that in America, where the markets gained on hopes that the interest rate cycle had peaked.

Market leader China Resources put on 2.6%. Among other leading stocks, Hutchison Wham-poa reached a high of HK$103.50 after telling the market it expects a HK$6.5 billion (£555 million) profit from the merger of its Canadian oil interest Husky.

Elsewhere, the biggest move came in Seoul, where the Kospi added 14.25 to 769.63. Gains by information and telecoms firms in the US overnight translated into gains for counters such as Sam-sung Electronics, Korea Telecom and long-distance carrier Dacom. The over-the-counter Kosdaq market was also active, the market index up 3.3%.

Overtures for a summit with China from Taiwan's President Chen Shuibian helped Taipei shares move higher, the Composite up 35.55 to 8786.65. Singapore's Straits Times reclaimed the 2000-points level, advancing 24.67 to 2021.24, with the electronics sector leading the way. Thailand's SET added 3.27 to 343.93, but Malaysia's Composite continued its descent, off 6.83 to 806.46. Jakarta's Composite edged 0.42 lower to 490.27.

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