Asian Stock Markets Weighed by Banking Concerns, Lower Commodity Prices

Published April 21st, 2009 - 01:13 GMT

The equities markets in the Asia/Pacific region were lower on Tuesday with financial leading the decline as Bank of America Corp. first quarter earnings release raised the prospect for more write-downs amongst large banks. The Nikkei ended the session 2.4% lower after falling as much as 3.34% decline during the morning session.



Asia Session Key Developments

·         Crude oil falls to $45.70/bbl, copper futures tumble 4.5% to $4590 per metric ton

·         Bank of America sees more loan-related losses, will continue to raise reserves

Asian Stock Markets Weighed by Banking Concerns, Lower Commodity Prices

The equities markets in the Asia/Pacific region were lower on Tuesday with financial leading the decline as Bank of America Corp. first quarter earnings release raised the prospect for more write-downs amongst large banks. The Nikkei ended the session 2.4% lower after falling as much as 3.34% decline during the morning session, while the appreciation in the Japanese yen weighed on exporters, with bank and tech stocks also coming under selling pressure. Meanwhile, a broad decline in base metals spurred investors to selling holdings of resource and mining stocks.

NKY 225                                           8711.33

Japan’s Nikkei 225 Stocks Average fell 213.42 points, or 2.39% to close at 8711.33 in Tokyo, which is the largest decline in nearly two weeks. Toyota sank 3.9% while Honda Motor Co. lost 4.9% following the news that the automakers may cut domestic outputs as profits falter, and Sony Corp., which gets a quarter of its sales from the U.S., retreated 4.1% after Nikko Citigroup Ltd. lowered the firms rating to ‘hold’ from ‘buy.’

HSI                                                         15285.89

Hong Kong stock decline for the first time in three days as the Hang Seng Index dropped 465.02 points, or 2.95% to end the session at 15285.89, snapping a two-day, 1.1% advance as China Mobile earnings missed estimates, while commodity prices continued to tumbled lower. China Mobile Ltd., the world’s biggest wireless carrier, fell 5.1% after 1Q profit missed estimates, while HSBC Holding Plc, which owns a U.S. mortgage business, slumped 5.1% following the comments from Bank of America, and Cnooc Ltd., China’s biggest offshore energy explorer, slid 5.2% as oil prices slipped below $46/bbl.

ASX 200                                            3677.40

Australia’s ASX 200 Index slipped 91.60 points, or 2.43% to close at 3677.40, led by a 3.25% drop in financials and a 3.19% decline in basic materials. BHP Billiton Ltd and Rio Tinto Group plunged 4.0% and 5.8%, respectively, as metal-trade in London slumped 4.4%, while banking shares tumbled lower after Bank of America Corp. announced that it will continue to build reserves for loan-related losses over ‘the next couple quarters.’

Notable Asian Session Event Risk / Economic Releases

You may also like