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Tokyo reels as techs tumble
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July 22, 1999: 5:51 a.m. ET
Nikkei dives 527 points as strong yen depresses exporters; HK feels Asian pain
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LONDON (CNNfn) - A firming yen and an exodus from export-reliant technology shares sent Japanese blue chips reeling almost 3 percent Thursday.
Hong Kong shares were also dragged into the red in a late session slide as worries about U.S. market fragility dampened sentiment across the region.
Seoul and Jakarta possessed the only rising indexes in the region as markets assumed a cautious stance before Federal Reserve chief Alan Greenspan's testimony to U.S. lawmakers later Thursday. The fear in Asia - as elsewhere on global markets - is that Greenspan's remarks on monetary and economic policy may block a further advance of Wall Street's bulls.
Japan's benchmark Nikkei 225 average fell 527.18 points, or 2.89 percent to end at 17,730.34 as an upward move in the yen against the dollar caused concerns about the impact on Japan's high-tech manufacturers, which are heavily reliant on exports. The Nikkei dipped below the psychologically sensitive 18,000 level for the first time since July 12.
The yen touched 119 against the dollar Wednesday, down from an earlier level of 118.70, after the Bank of Japan stepped in to sell yen. On Thursday, the dollar was trading at about 118.28 amid signs market players were downplaying the impact of the BoJ's yen-selling intervention.
High-tech stocks came under selling pressure ahead of the Greenspan speech. The strengthening yen could bite into the dollar earnings of Japanese exporters by discouraging overseas purchasers.
Hitachi fell 0.69 percent to 2,890 yen; Sony slid 3.35 percent to 13,850 yen; NEC retreated 2.92 percent to 1,760 yen and Toshiba gave up 2.2 percent to 890 yen.
Honda Motor Co. and Fuji Photo Film Co. both lost more than 3 percent.
Bucking the high-tech downtrend, Internet investor Softbank Corp. closed up 3.47 percent at 31,000 yen after Lehman Brothers raised its 12-month share-price target to 50,000 yen from a previous target of 41,600 set on June 7.
Asian losses sour mood in Hong Kong
The Hang Seng index, which headed into afternoon trade on a positive footing, saw those gains evaporate in late trade after Tokyo's big slide. Hong Kong's premier index ended down 0.38 percent, or 50.60 points, at 13,369.06.
Index anchor HSBC Holdings closed up HK$0.50 at HK$94.00. Bank of East Asia lost HK$0.10 to HK$17.95 and Hang Seng Bank gave up HK$0.50 to HK$82.75. Among property stocks, Hutchison Whampoa ended off HK$1.00 at HK$72.00 and Sun Hung Kai Properties gave up HK$1.25 to HK$68.00.
China Telecom, the object of recent speculation about a big-share issue, retreated HK$0.20 to HK$22.95.
Singapore's Straits Times index stocks took its cue from Tokyo, falling 1.4 percent to close at 2,067.89, driven lower by losses in Singapore Press Holdings. Shares of SPH incurred heavy losses amid reports that the company's near-monopoly over newspaper publishing may be in jeopardy.
Weakness in resource stocks pulled Australian shares lower Thursday. The All Ordinaries index closed down 0.81 percent, or 25.1 points, at 3,086.3.
Selling by overseas funds soured sentiment in Taiwan where the island's weighted index closed down 1.39 percent at 7,678.67. Local traders said the market received lukewarm support from government funds as cross-strait tensions with China continued to weigh on morale.
Worries over China relations, corporate results and the peso sent Philippine stocks 1.22 percent lower to close below the 2,500 resistance level at 2,488.62,
Seoul shares reversed a sharp early decline to end up 1.2 percent, at 976.66, as hopes emerged that creditors may assuage the woes of the debt-saddled Daewoo Group.
Jakarta shares finished marginally higher at 642.655 despite unfounded rumors that the country's former president, Suharto, had died.
Malaysian shares fell 0.81 percent, while Thai stocks backtracked 2.04 percent amid a sell-off in banking and financial issues following the release of first-half earnings.
--from staff and wire reports
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