Market Update
Asian markets opened lower Tuesday, tracking sharp overnight losses on Wall Street after disappointing U.S. manufacturing data soured risk appetite.
The Nikkei tumbled 3.4% at 12:43 p.m. Tokyo time, extending yesterday's decline. The Hang Seng fell 2.4% while the All Ordinaries lost 1.6%. Mumbai's Sensex also opened weak, tracking global cues -- down 0.9% in early trades.
Mainland Chinese markets remained closed for the Lunar New Year Holiday.
Growth concerns revisited the markets after dismal manufacturing report from the U.S. stirred up fears of slowdown in major economies.
The U.S. factory index for January by the Institute for Supply Management fell to 51.3 as compared with 56.5 in December. Although the reading was above the crucial mark of 50, it came in lower than expected; which hit investor confidence. Wall Street bourses logged sharp losses in response to the data.
Sentiment was already fragile in the region after an official report released in China over the weekend had shown slower industrial activity in the world's second-largest economy during January as compared with a month ago.
Lower risk appetite prompted investors to flee out of riskier assets like equities into safer havens like bullion, bonds and the yen. The yen was trading near a two-month high against the U.S. dollar, further pressurizing export-oriented stocks in Tokyo. Gold futures also staged a rally overnight as investors scuttled for safer bets.
In other news, the Australian central bank held its key interest rate steady at 2.5% in line with expectations.
Stocks on the Move
Exporters in Tokyo were under the hammer on account of the yen's strength as a stronger currency reduced their earnings outlook in overseas markets.
Top losers included Sharp Corp., Sony Corp., Mazda Motor Corp., Honda Motor Corp. and Panasonic Corp., --- all down more than 5% each.
Metal players, oil firms, financials, utilities as well as retailers were trading with deep cuts as losses were across all sectors.
In Hong Kong, Lenovo Group plunged over 14% after reports said the company is in talks with Japan's Sony Corp. to buy the latter's unprofitable Vaio PC business overseas.
Other tech stocks were also considerably lower -- Tencent Holdings Ltd. declined 3.4% while China Telecom Corp. erased 4%.
Among metal players, Aluminum Corp. of China gave up 3.6%, Angang Steel retreated 3.4% while Jiangxi Copper eased 2.6%.
Resources stocks in Sydney turned weak along with all other sectors as growth worries preponderated.
Index heavyweight BHP Billiton gave up 2.5% while Rio Tinto was down 1.7%
But gold miners were shining bright following overnight gain in prices of the yellow metal. Newcrest Mining jumped 4.2% while Northern Star Resources was up 2%.
Among other rare gainers, Country Road Ltd. skyrocketed nearly 45% after reporting its first half results.
REA Group was also up around 5% after its results topped analysts' estimates, but Downer EDI slipped 1.5% despite posting 5.4% hike in first-half profit.
Meanwhile top losers on the 30-share benchmark index in Mumbai included Gail India (down 3.5%), Wipro (down over 3%), Mahindra & Mahindra (down 2.9%), TCS (down 2.2%) and Hindalco Industries (down 2.1%).