MUMBAI (MarketWatch) — Hong Kong led a drop for Asia stocks on Thursday, in the second day of notable losses for Chinese corporations, as investors grappled with a slew of heavyweight earnings and concerns about a global growth slowdown.
Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +0.03% fell 1.3%, and the Shanghai Composite index /zigman2/quotes/206600939/delayed CN:000001 +1.25% declined 1.4%, extending a steep fall made in the previous session.
Australia’s S&P/ASX 200 index /zigman2/quotes/210598100/delayed AU:XJO +0.41% outperformed the region by dipping a mere 0.1% to hover around a four-month-plus high set in the previous session.
Dow's downward trend or downward spiral?
Is the current downward trend for the Dow industrials something to take a closer look at? Photo: Reuters.
U.S. shares had lost ground on Wednesday, dragged by a weaker-than-expected rise in durable goods orders that sparked fresh concerns about the future trajectory of global growth. Read more on U.S. stocks.
Against growth worries, copper prices also suffered in New York trading, with May copper shedding 9 cents, or 2.3%, to $3.79 a pound. Read more on metals.
Gold futures fell as well, while Nymex light sweet crude oil for May delivery ended down 1.8% at $105.41 a barrel. Read more on oil.
Commodity-trading houses were under pressure in Japan, with Mitsui & Co. /zigman2/quotes/205346820/delayed JP:8031 +1.20% /zigman2/quotes/202709767/delayed MITSF -7.69% falling 3.3%, and Mitsubishi Corp. /zigman2/quotes/208582984/delayed JP:8058 +1.07% losing 2.8%.
In Sydney, copper and gold extractor PanAust Ltd. , down 4.8%; and diversified mineral giant BHP Billiton Ltd. /zigman2/quotes/201448516/delayed AU:BHP +2.76% /zigman2/quotes/208108397/composite BHP +1.98% , down 1%. See report on BlackRock cutting BHP stake.
Oil giant Cnooc Ltd. /zigman2/quotes/203421416/delayed HK:883 -0.73% lost 3.3% after the firm said late Wednesday that its fiscal-year net profit rose 29% to $11.2 billion, a figure that slightly exceeded analysts forecasts. However, the company also set a conservative production output target for this year. Read more on Cnooc results.
In other Chinese earnings news, China Shipping Container Lines Co. /zigman2/quotes/208184929/delayed HK:2866 0.00% /zigman2/quotes/200454970/delayed CITAF -10.17% /zigman2/quotes/200656011/delayed CN:601866 +0.38% fell 2% in Hong Kong after it swung to a 2011 net loss of $428 million due to rising fuel costs. See report on China Shipping Container results.
Port operator China Merchants Holdings International Co. /zigman2/quotes/200768665/delayed HK:144 -0.77% /zigman2/quotes/200081022/delayed CMHHY +5.74% fell 2.7% in Hong Kong after its own annual net profit slipped 5.3%, weighed down by higher costs.
Still, Bank of Communications Co. /zigman2/quotes/203442771/delayed HK:3328 0.00% /zigman2/quotes/208048873/delayed BKFCF +2.25% /zigman2/quotes/207155262/delayed CN:601328 -0.22% managed to rise 0.7% after posting an above-forecast 30% rise in annual profit, even as it cut its dividend in half. See report on BoCom earnings.
China Merchants Bank Co. /zigman2/quotes/209899244/delayed HK:3968 -0.80% /zigman2/quotes/208876947/delayed CIHKY -2.28% /zigman2/quotes/210188047/delayed CN:600036 -0.15% only fell slightly, slipping 0.3% in Hong Kong after the lender’s 40% jump in annual net profit met analysts forecasts. Read more on China Merchants earnings.
Andrew Sullivan at Piper Jaffray said: “I think the key thing for a lot of people at the moment is that the valuations we’re getting from results don’t justify where the market’s sitting.”
Markets have lately been driven up by liquidity from central banks, he said, adding that “if you’re a short-term investor ... you’re going to try to lock in the profits that you’ve made.”
“We’re also coming to the quarter end and I think that a lot of people are looking to lock in quarter gains and maybe change their trading portfolio approach. Hong Kong’s up 12% — a number of funds will lock in cash now and may re-enter the market in April,” he said.
Japanese technology stocks were losing ground after a weaker-than-expected outlook from U.S. technology firm Applied Materials Inc. /zigman2/quotes/209393259/composite AMAT +0.49% sent the U.S. Philadelphia Semiconductor Index /zigman2/quotes/210598361/realtime SOX +0.38% down 1.3% on Wednesday.
Advantest Corp. /zigman2/quotes/206869087/delayed JP:6857 +0.57% /zigman2/quotes/202479540/delayed ADTTF -7.38% lost 2.9%, Tokyo Electron Ltd. /zigman2/quotes/202883609/delayed JP:8035 -0.85% [ /zigman2/quotes/200298228/delayed TOELF -1.19% fell 3%, and Kyocera Corp. /zigman2/quotes/204880749/delayed JP:6971 -0.10% /zigman2/quotes/205094593/delayed KYOCF -1.80% shed 1.9%.
A drop below the 83-yen mark overnight for the U.S. dollar /zigman2/quotes/210561789/realtime/sampled USDJPY +0.0649% also dragged broadly on exporters, with Sony Corp. /zigman2/quotes/201361720/delayed JP:6758 -0.52% lower by 1.5%.
On the plus side, Sharp Corp. /zigman2/quotes/203224600/delayed JP:6753 -0.56% /zigman2/quotes/207472799/delayed SHCAF +0.53% jumped 6.7% after trading bid-only in the previous session following news of an investment in the firm from Taiwan’s Hon Hai Precision Industry Co. /zigman2/quotes/207256514/delayed TW:2317 -0.48% . See report on Sharp-Hon Hai deal.
Shares of Hon Hai gained 2.7% in Taipei.