China factor still weighing on Asian markets; Cathay Pacific shares down
City Index January 21, 2011 4:16 PM
<p>Fresh concerns over China raising interest rates to cool demand have sent Asian markets falling. The Hang Seng was down 0.2% at 23,957 with Basic […]</p>
Fresh concerns over China raising interest rates to cool demand have sent Asian markets falling. The Hang Seng was down 0.2% at 23,957 with Basic Materials sector down 1.5% but Consumer Goods up 1.3%.
Cathay Pacific Airways fell 4.7% on a decision to investigate its Airbus emergency landing incident which occurred on August 11, 2010. China Unicom Hong Kong was up 2.16% on buying by China Asset Management Co.
In Japan, the Nikkei was down 1.5% at 10,277 as investors took profits in the afternoon amid continued worries over China’s macro economic outlook. The Nikkei is on course for its biggest weekly decline since October last year.
Oil and Gas, and Basic Materials sectors were down 3.2% and 2.3% respectively. Sumitomo Metal Mining dropped 5.5% as gold-mine hedges fell 30% in third quarter.
The China factor seems to affect the Australian market as well where mining shares traded lower. This is because if China decides to tighten the reign on their economy, Australia’s resources sector may get the biggest blow.
The finance sector is doing quite well, with most of the banks trading slightly higher. But the rise among bank stocks is not enough to offset the pull from the materials sector.
Fortescue Metals has recovered from the sell-down yesterday. I think the sell-off on FMG was overdone yesterday and we may see some bounce on the price in the short-term.
ANZ Bank is up more than 1 per cent. Investors seem to be happy with ANZ’s decision and announcement of its expansion in China. ANZ seems to be doing the right thing with its Asian expansion and this China announcement is definitely welcomed by investors.
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