Old economy supports Nikkei
Hyundai Engineering weighs on Seoul; HK higher
By Mariko Ando, CBS.MarketWatch.com
Last Update: 5:04 AM ET Mar 28, 2001
TOKYO (CBS.MW) - Old economy shares sparkled Wednesday in Tokyo, lifting the market's key stock gauge despite weakness in leading technology issues.
Hong Kong and Sydney also firmed after U.S. shares welcomed a report on Tuesday that the U.S. consumer sentiment improved in March, following five straight months of decline. But Seoul dropped after Hyundai Engineering and Construction posted massive net losses for last year, dragging down its creditor banks' shares.
Tokyo action
Japan's Nikkei Average closed up 0.93 percent, or 127.18 points, at 13,766.51. The broader TOPIX advanced 0.57 percent to 1,337.29.
Looking ahead, the Bank of Japan is due to release its "tankan" survey of business sentiment on Monday.
Kawasaki Heavy (KWHIY: news, msgs, alerts) shares climbed 2.4 percent to 170 yen after Nihon Keizai daily reported that the company has reached agreement with Ishikawajima-Harima Heavy Industries Co. (IHI) to integrate their shipbuilding businesses. IHI shares jumped 6 percent to 265 yen.
Sekisui House jumped 7.6 percent to 1049 yen after the country's top home builder announced that it will spend as much as 85 billion yen ($695.7 million) over the next year to buy back and retire up to 70 million shares.
But technology shares erased earlier gains and sank into negative territory on worries that the recent sharp rises in the sector might have been overdone.
Shares of Canon (CAJ: news, msgs, alerts) tumbled 2.3 percent to 4,770 yen and Sony (SNE: news, msgs, alerts) lost 0.2 percent to 9,350 yen.
Honda Motor (HMC: news, msgs, alerts) sank 2.1 percent to 5,130 yen after the company on Tuesday sharply revised downward its forecast for unconsolidated net profit for the year ending this month amid sluggish sales in Europe. See full story.
The yen little moved against the dollar and traded recently at 122.14 per dollar by late afternoon in Tokyo, compared to 122.20 in New York late Tuesday and 122.50 in Tokyo.
Seoul lower, HK, Sydney gain
South Korea's Kospi ended down 0.77 percent to 528.79.
Hyundai Engineering and Construction (HYEHF: news, msgs, alerts) plunged limit down at 15 percent to 1,050 won. The country's top contractor said it may ask creditors to exchange a third of its 4.5 trillion won ($3.5 billion) debt for shares, which may give lenders control of the company, according to a report from Bloomberg. The development came after the embattled contractor posted a record net loss of 2.98 trillion won ($2.3 billion) last year as it wrote off unpaid contracts in Iraq and other uncollected building fees.
Shares of Cho Heung Bank (CHGBY: news, msgs, alerts) sank 2.7 percent to 1,985 won and Shinghan Bank lost 2.8 percent to 10,550 won over Hyundai Engineering and Construction's financial problems.
Taiwan's technology shares dropped, dragging down the key Weighted Index by 1.1 percent to close at 5,819.39. Volume leader United Micro Electronics (UMC: news, msgs, alerts) dropped 3.6 percent to 53.00 Taiwan dollars after the company on Tuesday said it plans to issue a smaller-than-expected stock dividend of 1.5 Taiwan dollars per share based on 2000 earnings.
Winbond Electronics (WBEMF: news, msgs, alerts) sank 4.2 percent to 41.50 Taiwan dollars while Powerchip Semiconductor (PWSMY: news, msgs, alerts) also dropped 4.3 percent to 33.00 Taiwan dollars.
Hong Kong's Hang Seng Index gained 1.13 percent, or 143.51 points, to close at 12,851.41 following the Wall Street's strong performance overnight. China's biggest mobile phone firm, China Mobile HK (CHL: news, msgs, alerts) rallied 3.5 percent to 35.20 Hong Kong dollars and Johnson Electric Holdings (JELCY: news, msgs, alerts) jumped 2.4 percent to 12.95 Hong Kong dollars.
Banking and property shares were also higher. The market heavyweight HSBC Holding shares (HBC: news, msgs, alerts) rose 1.4 percent to 91.75 Hong Kong dollars and property developer New World Development (NDVLY: news, msgs, alerts) , up half a percent to 10.20 Hong Kong dollars.
But Richard Li's Internet and telecoms firm Pacific Century Cyberworks (PCW: news, msgs, alerts) dropped 0.7 percent to 3.475 Hong Kong dollars. The company was slated to release its full year results after the market closed on Wednesday for the first time since acquiring Hong Kong's dominant telcom firm C&W HKT in August last year.
Australia's All Ordinaries Index advanced 0.3 percent to 3,127.40, led by a 1.8 percent jump in shares of News Corp. (NWS: news, msgs, alerts) which rose to 16.59 Australian dollars.
Telstra shares (TLS: news, msgs, alerts) erased earlier gains and slid 0.8 percent to 6.52 Australian dollars. Australia's top telecom group on Tuesday said it would form a Hong Kong-based international unit, Telstra International, to manage and expand the company's Asia-Pacific interests, according to a report from Reuters.
The country's No.2 telecom firm Cable & Wireless Optus dropped 1.4 percent to 3.55 Australian dollars. Shares have tumbled more than 9 percent since Singapore Telecommunications on Monday reached an agreement to purchase Optus.
In New Zealand, the NZ Top 40 slid 0.25 percent to close at 2,037.81, despite a 2.3 percent jump in shares of volume leader Telecom NZ shares (NZT: news, msgs, alerts) , which rose to 5.85 New Zealand dollars.
Singapore's Straits Times Index dropped 1.49 percent to 1,654.32. SingTel shares (SGTJY: news, msgs, alerts) climbed 3.7 percent to 1.95 Singapore dollars, after plunging 14 percent on the Tuesday.
Mariko Ando is a Tokyo-based reporter for CBS MarketWatch.com.
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