Asian markets pared gains to close weak Tuesday as investors worried about ongoing uncertainty in the euro-zone.
The Nikkei closed down 1.3%. The Shanghai Composite reversed direction to close 0.2% lower while the Hang Seng ended flat. The Sensex also ended flat, down a few points, while in Sydney the S&P/ASX All Ordinaries gained 0.5%.
Shares exposed to Italian debt lost ground in Japan while earnings related news also pressured some stocks.
In Rome, Prime Minister Silvio Berlusconi defiantly held on despite huge pressure to resign.
In Greece, the country’s two largest political parties failed to agree on a new prime minister as negotiations continued late into Monday night. The sixth tranche of eight billion euro is conditional upon the country’s new national unity government agreeing to the broad terms settled in October, via a written statement of intent.
The funds were previously approved by euro-zone officials but frozen after outgoing Prmie Minister George Papandreou proposed holding a referendum on the new bailout package.
Stocks on the Move
Shares of scandal ridden Olympus plunged 29% after the company said M&A funds were used to cover losses on securities investments dating back to the 1990’s.
Bellwether Toyota reversed 1.7%. It posted a 32.4% drop in quarterly operating profit after market hours and retracted its full-year profit estimates due to the floods in Thailand which have forced a production halt.
Nomura Holdings was down 14.9%. The firm said earlier this month it estimates its Europe exposure at $3.55 billion, mostly in Italian government securities and positions that mature in the next five months. Daiwa Securities ended down 7%.
Exporters were also among the leading decliners as the yen remained persistently strong. Index heavyweight Sony was down 4.1% while Panasonic and Nikon lost 3.3% and 1.7% each, respectively.
Chipmaker Elpida Memory tumbled 10.4% while Advantest gave up 3.5% despite a report from Deutsche Bank research yesterday saying falling prices for dynamic random-access memory are showing signs of bottoming out.
Banking stocks helped limit losses in Hong Kong. Index heavyweight ICBC ended up 0.8% while Bank of Communications gained 3.3%. But the index was pressured by Tencent Holdings which fell 5.5% while China Overseas Land & Investment gave up 4.8%. Aluminum Corp. of China shed 5.2%.
The Sensex faltered after a steady start in Mumbai. Deputy Governor at the RBI Subir Gokarn said the central bank would hold rates and stick to its guidance on monetary policy until further notice.
The Reserve Bank of India raised interest rates in late October for the 13th time since 2010.
Top losers on the Sensex were Sun Pharma and DLF, down 2.2% and 2.1% each, respectively. Cipla, Jindal Steel, Bajaj Auto, NTPC and Jaiprakash all declined in a range between 1% and 1.3%.
Aussies shares clawed back gains after falling initially on news the country’s trade surplus was weaker than expected. The surplus fell to $2.56 billion in September, down from $2.95 billion in August on a seasonally adjusted basis, official figures showed.
Major miners were above ground with BHP Billiton ending 0.1% higher while Rio Tinto gained 1.4%.
The four big banks also recorded gains as CBA, NAB, ANZ and WBC traded in a range between 0.7% and 1.8%.
At its AGM, Commonwealth Bank said it expected subdued credit growth to continue into next year.
Fairfax Media fell 3.2% after announcing plans to raise more than $420 million through an initial public offer of its online classifieds in New Zealand.
Westfield gained 1.7% after it confirmed its full-year earnings forecast and said its business was in good shape.
The Australian Parliament passed the controversial carbon tax, modestly boosting the shares of Carbon Conscious, which operates forestry plantation projects for carbon offset credits. Its shares closed up 2.6%.
