RTTNews - The Asian markets ended in negative territory on concerns that the prospects of recovery might hit a roadblock following continued weakness in consumption spending in the world's largest economy, the U.S, the consumer sentiment index unexpectedly declined, economic data released on Friday in New York revealed. Sharp decline in commodity prices and strengthening of the greenback also weighed on market sentiment.
In Japan, the benchmark Nikkei 225 Index slumped 328.72 points, or 3.10% to close at 10,269, while the broader Topix index of all first section stocks was down 23.98 points, or 2.46%, to 950.
On the economic front, a preliminary report released by the Cabinet Office revealed that the economy expanded by 0.9 percent in the second quarter of 2009, roughly in line with analyst expectations for a 1.0% increase following a revised 3.1% contraction in the first quarter. The report further noted that on an annualized basis, GDP was up 3.7% - roughly in line with forecasts for a 3.9% gain following the 14.2% contraction in the previous three months. Nominal GDP was down 0.2% on quarter and 0.7% annualized.
Exporters, automakers, trading companies and banks declined on concerns about economic recovery. The strengthening of the local currency against the US dollar also weighed on market sentiment.
Trading companies declined following sharp drop in commodity prices in the international market on Friday. Mitsubishi Corp., declined 3.61%, Sumitomo Corp. lost 3.33%, Mitsui & Co. fell 4.17% and Toyota Tsusho Corp. 3.83%. Sony Corp., which makes Vaio brand computers, declined 4.05%.
Automakers also ended weaker. Toyota Motor Corp., shed 2.67%, Honda Motor lost 3.85%, Nissan Motor fell 3.43% and Mazda Motor slumped 5.01%.
Realty stocks also ended weaker following news that investment in housing declined 9.5% during the second quarter. Sumitomo Realty and Investment slumped 5.84%, Mitsui Fudosan fell 4.57% and Mitsubishi Estate lost 4.26%.
Among precision equipments, Konica Minolta Holdings lost 3.17%, Citizen Holdings fell 3.97% and Ricoh Co., declined 3.87%.
In banking space, Mitsubishi UFJ Financial lost 2.64%, Mizuho Financial Group fell 3.39%, Resona Holdings shed 1.35% and Sumitomo Mitsui Financial declined 3.61%.
In Australia, the benchmark S&P/ASX200 Index lost 72.60 points, or 1.63%, to close at 4,388, and the All-Ordinaries Index ended at 4,398, representing a loss of 67.00 points, or 1.50%.
Metals and mining stocks declined following drop in commodity prices in the international market on Friday.
BHP Billiton declined 2.95%, Gindalbie Metals shed 1.70%, Minara Resources slumped 7.58%, Rio Tinto fell 4.82% and Oz Minerals lost 5.60%. Fortescue Metals, however, bucked the trend and gained 2.92% after announcing that it has agreed to sell 20 million tonnes of iron ore to its customers in China at 35% to 50% discount in prices that prevailed in 2008-09 season.
The largest steelmaker in the country, Bluescope Steel, slumped 6.97% after the company reported that it slipped to a loss of $393 million for the first half of 2009 compared to profit in the corresponding period last year. The steelmaker attributed lower prices and drop in revenue as primary reasons for the loss.
Mixed trading was witnessed among oil stocks following sharp drop in crude oil prices in the international market. Woodside Petroleum lost 1.43% and Santos fell 1.63%. However, Oil Search added 0.36% and Origin Energy advanced 0.92%.
Banks declined sharply on renewed concerns about growth prospects. ANZ Bank lost 2.36%, Commonwealth Bank of Australia fell 3.66%, National Australia Bank declined 2.66% and Westpac Banking shed 2.16%.
Mixed trading was witnessed among the gold stocks. While Newcrest Mining managed to end in positive territory with a gain of 1.72%, Lihir Gold slipped 1.54% and Sino Gold Mining slipped 0.87%.
In Hong Kong, the Hang Seng Index ended lower 20,137, down 756.26 points or 3.62%, taking cues from other Asian markets that slumped on concerns about growth prospects. Lower commodity prices also weighed on market sentiment. All the 42 components of the index ended in the negative territory, with property stocks, commodities and banks leading the slump.
In South Korea, the benchmark KOSPI Index fell 44.35 points, or 2.79%, to close at 1,547. Concerns about global recovery following weak consumer sentiment numbers for August in the U.S and falling Chinese stocks helped large investors unwind the stocks on profit taking.
In India, broad-based sell-off in global markets on concerns about the pace of global economic recovery, worries about a slowdown in the domestic economy due to deficient monsoon rains dragged the market sharply lower below support levels. The benchmark BSE Sensex ended at 14,785, down 627 points or 4.07% and the S&P CNX Nifty plummeted 192 points or 4.20% to 4,388.
Among the other major markets in the region, China's Shanghai Composite Index slumped 176.34 points, or 5.79%, to 2,871, Singapore's Strait Times Index lost 85.53 points, or 3.25% to close at 2,546 and Taiwan's Weighted Index shed 137.71 points, or 1.95% to close at 6,932.
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