Nikkei rebounds from 18-year low
But banks sag on S&P downgrade, credit risk fearTOKYO (CBS.MW) -- The Nikkei Average rebounded by midday Wednesday from the previous session's 18-year low, as a recovery in technology issues offset nagging concerns over credit risks among Japanese financial institutions.
By Mariko Ando, CBS.MarketWatch.com
Last Update: 10:51 PM ET Feb 5, 2002
The Nikkei rose 55.91 points, or 0.6 percent, to end the morning session at 9,531.51.
On Tuesday, the index lost 1.6 percent to end at its lowest close since Dec. 15, 1983. Investors have been anxiously monitoring whether the gauge would breach its post-bubble intraday low of 9,382.95, a level last seen within a week after the Sept. 11 terrorist attacks in the United States.
The broader Topix was up 0.4 percent at 929.97 points, also bouncing back from the previous day's fresh 17-year low.
Major technology issues, such as NEC (NIPNY) (6701) and Toshiba (6502), got a break from the heavy selling pressure seen in recent sessions. Tech stocks also sought to shrug off weakness in Tuesday's U.S. trading, during which the Nasdaq lost 0.9 percent and the Dow Jones Industrials ended essentially flat.
NEC's shares climbed 2.3 percent to 902 yen, after falling 12 straight days until Tuesday.
Toshiba jumped 2.1 percent to 397 yen. The shares fell below 400 yen on Tuesday for the first time since July 1986.
TDK (TDK) (6762) gained 1.6 percent to 5,760 yen. Shares rose despite the company posting losses in third quarter and said it was facing its first-ever annual loss in the financial year ending in March. See full story.
Honda Motor (HMC) (7267) also drew buyers, after posted a record third-quarter profit thanks to a weak yen and brisk sales in the Japanese and U.S. markets. See full story.
Honda's shares rose 1.6 percent to 5,200 yen.
Limiting Tokyo's overall gains, leading banks lost ground as a result of ongoing worries over bad loans.
Investors are concerned that a recent drop in approval ratings for Prime Minister Junichiro Koizumi could make it more difficult for him to lead a campaign for drastic structural reforms, including the disposal of banks' bad loans.
Such concerns took on added weight after Standard & Poor's on Tuesday downgraded several major Japanese banks -- Mizuho Holdings, Sumitomo Mitsui Banking, UFJ Ban, Bank of Tokyo-Mitsubishi and Yasuda Trust & Banking.
Shares of Mizuho Holdings (8305), the world's biggest bank as measured by assets, shed 1.9 percent to 206,000 yen. Sumitomo Mitsui Banking (8318) tumbled 3.3 percent to 416 yen.The dollar fetched 133.86 yen in late Tokyo dealings, against 133.95 yen in New York late Tuesday.
Taiwan stocks jump
Taiwan stocks were sharply higher by mid-morning as major technology issues gained ground despite pre-holiday caution exhibited by some traders. The Weighted Index gained 1.9 percent to 5,956.78.
The index has gained over 70 percent since early October, when it sank to its nine-year low boosted by hopes for a recovery in the global technology industry.
Taiwan's stock market will be closed from Thursday for the Lunar New Year holiday and will reopen on Feb. 18.
Shares of Powerchip Semiconductor (PWSMF) climbed 2.1 percent to NT$29.90. The memory chip firm said its sales had fallen 25 percent in January on a year-over-year basis. But the figure marked a 70 percent improvement from December sales.
Taiwan Semiconductor Manufacturing (TSM) also caught a rising wave, jumping 2.3 percent to NT$87.50. The world's largest contract chipmaker expects sales to rise by 20 percent to 30 percent in 2002, said a Reuters report citing a TSM official. South Korean stocks traded flat as investors remained cautious about the direction of trading on Wall Street. The benchmark Kospi was standing steady at 740.20 points by late morning.
The country's top cell phone service provider, SK Telecom (SKM) saw its shares advance 0.4 percent to 247,000 won. SK Telecom is interested in forming a venture with the cellular unit of Philippine Long Distance Telephone (PHI), according to the Philippine Daily Inquirer report.
Hynix Semiconductor (HXSDY) gained 1.2 percent to 2,500 won, buoyed by speculation that a much-discussed alliance with a foreign chipmaker would come to pass, perhaps imminently.
Hynix, South Korea's financially troubled chipmaker, is believed to be in talks with Micron Technology (MU) of the United States and with Germany's Infineon Technologies (IFX).
Gold stocks shine in Sydney
Australia's All Ordinaries Index was standing down 0.2 percent at 3,388 points by late morning. Rupert Murdoch's News Corp. (NWS), the media company that accounts about 9 percent of the index, dropped 1.3 percent to A$13.02.
But a rise in gold prices pushed up mining stocks. Shares of Lihir Gold (LIHRY), which operates a gold mine on Lihir Island of Papua New Guinea, rallied 4.7 percent to A$1.56. Normandy Mining (NMDMF) climbed 4.4 percent to A$2.38.
Singapore's Straits Times Index rose 0.7 percent to 1,739.88, poised to snap a three-day losing streak during which it lost 3.3 percent.
Shares of Singapore Telecommunications (SGTJF) advanced 0.6 percent to S$1.8. The company is scheduled to post quarterly and full-year results on Friday.
Elsewhere in the region, Malaysia's KLSE Composite fell 0.4 percent to 717.61 points by midway through the morning session. Manila's PSE Composite picked up 0.2 percent to 1,374.86.
New Zealand's stock market was closed for a public holiday.
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