Stocks fall on poor earnings, Japan disaster
Updated: 2011-03-24 07:02
(HK Edition)
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Hong Kong stocks fell Wednesday, driving the benchmark Hang Seng Index (HSI) lower for the first time in four days, as China Coal Energy Co's earnings missed analyst estimates and engineers struggled to get power to a crippled Japanese reactor.
The HSI fell 0.1 percent to 22825.40 at the close of trading in Hong Kong, with about four stocks declining for every three that advanced among the index's 45 companies.
The gauge slumped 4.1 percent last week, the biggest weekly drop since February, amid concern Japan's strongest earthquake and damage to a nuclear plant would cripple the world's third-biggest economy.
The Hang Seng China Enterprises Index lost 0.2 percent to 12752.61.
Oil rose to a two-week high in New York amid concern that increased allied attacks in Libya will prolong supply disruptions and that the escalating turmoil in the Middle East may curtail shipments.
Crude oil for May delivery rose as high as $105.38 a barrel in electronic trading on the New York Mercantile Exchange. That was the highest intraday price for futures since March 9. The April contract, which expired Tuesday, gained 1.6 percent to $104.
China Coal slumped 9.1 percent to HK$10.74. The company said full-year net income increased 1 percent to 7.47 billion yuan ($1.1 billion). That missed the average estimate of 10 billion yuan by 17 analysts in a Bloomberg survey. Maanshan Iron & Steel declined 2.4 percent to HK$4.15. The company reported second-half net income tumbled 95 percent to 60 million yuan because of higher costs and slowing demand from builders and automakers.
Engineers at the Fukushima Daiichi nuclear plant in northern Japan are unable to connect power to one of four damaged reactors, marring progress to cool the fuel rods, Hidehiko Nishiyama, a spokesman for the Japan Nuclear and Industrial Safety Agency, said Wednesday.
Economic damage from the magnitude-9 earthquake and tsunami that struck northeastern Japan on March 11 may last longer than after the Kobe temblor in 1995, Bank of Japan board member Ryuzo Miyao said.
Foxconn slipped 1.6 percent to HK$4.96. Makers of mobile-phone handsets and personal computers will be affected by supply disruptions in Japan, a major provider of components that are used in the electronics industry, Daiwa Securities Group Inc said last week. China Life Insurance Co slid 2.1 percent to HK$28.60. Credit Suisse Group AG cut its rating on the stock to "underperform" from "neutral". The company Tuesday reported full-year net income rose 2.3 percent to 33.6 billion yuan, in line with analyst estimates.
China Dongxiang Group Co tumbled 11 percent to HK$2.51, the biggest drop in the Hang Seng Composite Index. HSBC Holdings Plc lowered its rating on the stock to "underweight" from "neutral".
Futures on the HSI were little changed at 22810.
Bloomberg
(HK Edition 03/24/2011 page2)