Asia's Stock Rally Fizzles

Tuesday, June 09, 2009

HONG KONG--Major stock markets across Asia sagged Tuesday, as lower commodity prices dealt a blow to mining and resource shares. China Huiyuan Juice dived in the Hong Kong market on news of a U.S. private equity firm's exit. Carriers extended losses, as China sought to consolidate its airline industry.

Japan's Nikkei 225 index dipped 0.8% to 9,786.82. Trading firms with commodities businesses fell across the board. Mitsui & Co dropped 3.7% to 1,256 yen ($12.82), Mitsubishi Corp slid 2.2% to 1,876 yen ($19.14) and Itochu Corp declined 2.5% to 700 yen ($7.14).

Mining companies and smelters were hit hard with Dowa Holdings shedding 3.1%, to 434 yen ($4.43), and Mitsui Mining & Smelting falling 4.0%, to 243 yen ($2.48).

Copper continued to lead a selloff among base metals in Asia on a stronger U.S. dollar and worries that China will soon enter the low season for copper consumption.

Crude oil futures for July delivery, by contrast, rose more than 1%, to $69 per barrel in Asia on Tuesday, rebounding from a two-day decline.

The dollar traded near 98.00 yen, as of 4:30pm in Hong Kong.

In Sydney, the S&P/ASX 200 lost 0.9% to 3,934.90. A National Australia Bank survey showed business confidence in the country rose 12 index points in May to negative 2 index points. Infrastructure spending drove the biggest monthly gain since May 2001.

BHP Billiton slid 4.4% to 36.50 Australian dollars ($28.94), while its rival-turned-partner Rio Tinto lost 2.6% to 70.61 Australian dollars ($55.98).

South Korea's Kospi index shed 1.5%, to 1,371.84 points.


Courtesy: Forbes.Com