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Regional stock markets retreat on profit-taking as Wall Street rally fades

Asian shares fell on profit-taking yesterday after four strong sessions as a rally on Wall Street fizzled out, but Sydney pared earlier losses caused by data showing Australian unemployment at a 10-year high.

With few catalysts to drive trade, investors took a breather before the release of fresh data from the United States and China.

Tokyo fell 1.79 per cent, or 265.32 points, to end at 14,534.74 as a stronger yen hit exporters, while Sydney was flat, dipping 2.0 points to 5,308.1. Seoul gave up 0.46 per cent, or 8.88 points, to end at 1,926.96.

Hong Kong fell 0.54 per cent, or 120.26 points, to 22,165.53 and Shanghai was down 0.55 per cent, or 11.56 points, at 2,098.40.

The Stock Exchange of Thailand also fell 0.16 per cent, or 2.19 points, to 1,311.87.

Global markets have so far enjoyed a positive week after a tumultuous time caused by the US Federal Reserve's decision to reduce its stimulus programme for a second time in two months.

The gains came despite last Friday's below-forecast US jobs data. Buying was given extra support on Wednesday by a report showing a huge surge in Chinese exports last month.

The China figures were welcomed after a string of disappointing news, including contracting manufacturing activity, that have indicated a slowdown in the world's No 2 economy.

Market players will be looking to the release in Beijing today of inflation data.

Sydney shares were hit after the Australian Bureau of Statistics said the jobless rate rose to 6.0 per cent in January - its worst level since July 2003 - from 5.8 per cent in December.

The rise comes as the government struggles to manage a bumpy economic transition from a decade-long Asia-led mining investment boom.

It also follows the news earlier in the week that Japanese auto giant Toyota, the last carmaker in the country, will close its Melbourne plant in four years, sounding the death knell for the Australian auto industry.

On Wall Street a four-day winning streak came to an end for the Dow and S&P on Wednesday, as investors took their cash off the table ahead of retail-sales figures and unemployment-benefit claims.

The Dow lost 0.19 per cent and the S&P 500 dipped 0.03 per cent, but the Nasdaq rose 0.24 per cent.

On oil markets, West Texas Intermediate for March delivery eased 61 cents to US$99.76, while Brent for March delivery was down 24 cents at $108.55.


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