Asian stocks dip on Greek debt impasse
HONG KONG—Asia’s major stock markets were mostly lower on Tuesday, tracking overnight losses on Wall Street, with investors retreating after Greece again failed to cut a deal on tackling its debt mountain.
On currency markets, the Australian dollar jumped on surprise news the central bank kept interest rates steady, while the yen eased slightly after Japan said it would intervene to damp down the value of its surging currency.
Tokyo lost 0.13 percent at the close, or 11.68 points, to 8,917.52 while Sydney shed 0.50 percent, or 21.8 points, to end at 4,274.2.
Seoul closed up 0.43 percent, with the benchmark KOSPI index adding 8.46 points at 1,981.59.
Hong Kong ended slightly down 0.05 percent, or 10.75 points, to 20,699.19 and Shanghai dipped 1.68 percent, or 27.5 points, to 2,291.902
Kuala Lumpur’s bourse was closed for a public holiday.
Events in debt-mired Greece again hung over the day’s activity, after crunch talks on Monday failed to reach an austerity deal, which is crucial to trigger the next slice of European Union bailout money.
Investors remained shy late Tuesday as Greek trade union leaders began a 24-hour general strike, while EU leaders castigated Athens for failing to reach a deal on cuts.
The weakness came after Monday’s strong response to positive US jobs data released last week.
“Markets have been torn between two conflicting situations. On the one hand, we have a US economy that is seemingly recovering in an impressive fashion,” said Chris Beauchamp, market analyst at IG Index in Singapore.
“On the other hand, we have Greece, an ulcer that has remained immune to every treatment the eurozone can throw at it,” he said, according to Dow Jones Newswires.
Athens is treading water over an agreement with private lenders to cut part of its 350-billion-euro ($460-billion) debt, with big loan repayments due next month raising fears of a default.
The impasse sparked a terse rebuke from French President Nicolas Sarkozy and German Chancellor Angela Merkel, who said it was time for Greece to take action on its fiscal problems.
As the general strike began, Greek Finance Minister Evangelos Venizelos pleaded with the political parties to reach a consensus with the country’s creditors.
“Instead of looking at this tragic dilemma… with national unity… there are many who spend their effort on a conventional, outdated, party confrontation as if nothing has happened,” the minister said.
On Wall Street, the Dow Jones Industrial Average lost 0.13 percent Monday, while the broad-based S&P 500 lost 0.04 percent, giving up early gains.
The Nasdaq Composite was down 0.13 percent.
“Another weekend has come and gone and Greece has still not agreed to bailout terms with its creditors,” noted analysts at Briefing.com.
In Japan, the government confirmed it had carried out “stealth” intervention following a single day yen sell-off of more than $100 billion in October.
Finance Minister Jun Azumi declined to comment on a separate action at the start of November but said everything remained on the table to ease the value of the yen to help Japan’s exporters. The strong currency makes their products more expensive overseas while eroding the value of repatriated foreign profits.
“I will not rule out any options, and I’ve been telling you that I will act when necessary,” Azumi said at a regular news briefing.
Australia held interest rates at 4.25 percent Tuesday, saying global conditions had, on balance, improved and local growth and inflation were close to target.
Also Tuesday, India revised down its economic growth forecast for the current fiscal year to below 7 percent, reflecting weakness in Asia’s third-largest economy.
European markets climbed in early trade, with London’s FTSE 100 index rising 0.21 percent and Frankfurt’s DAX 30 gaining 0.11 percent while the Paris CAC 40 advanced 0.33 percent.
On forex markets, the euro bought $1.3119 and 100.73 yen, compared with $1.3129 and 100.49 yen in New York late Monday.
The dollar was trading at 76.75 yen, against 76.54 yen in New York late Monday.
Oil prices were largely flat, with New York’s main contract, light sweet crude for delivery in March, at $96.22 a barrel and Brent North Sea crude for March delivery holding value at $116.15.
Gold was trading at $1,715.80 an ounce at 1110 GMT, against $1,719.90 in New York late Monday.
In other markets:
— Wellington edged up 0.1 percent, or 2.92 points, at 3,315.14.
Fletcher Building closed up 2.03 percent to NZ$6.54, while Telecom slipped 1.61 percent to NZ$2.145 and Air New Zealand was flat on NZ$0.915.
— Taiwan shares gained 0.25 percent, or 19.46 points, to 7,707.44.
Hon Hai rose 3.51 percent to Tw$97.3 while HTC was limit-down 7 percent to Tw$513.0 over an estimated sharp fall in first-quarter sales.
— Indonesian shares declined 0.5 percent, or 19.34 points, to 3,955.45.
Bank Rakyat Indonesia fell 2.1 percent to 6,850 rupiah, while auto distributor Astra International declined 1.8 percent to 75,650 rupiah.
— Singapore closed up 0.60 percent, or 17.68 points, at 2,957.78.
Oversea-Chinese Banking Corp. gained 0.23 percent to Sg$8.66 and oil-rig maker Keppel Corp. shed 0.19 percent to Sg$10.70.
— Indian shares fell 0.48 percent, or 85.11 points to 17,622.2.
Shares of India’s second-largest gold loan firm, Manappuram Finance, plunged 19.96 percent to 45.5 rupees, a day after the central bank barred it from accepting deposits from the public, citing violation of a bank law.
— Bangkok rose 0.65 percent, or 7.11 points, at 1,101.12.
Banpu gained 0.98 percent to finish at 620 baht, but PTT Plc was flat at 341 baht.
— Manila closed down 1.25 percent, or 60.35 points, to 4,755.98.
Philippine Long Distance Telephone dropped 1.30 percent to 2,730 pesos and BDO Unibank fell 0.49 percent to 61.35 pesos.
