Nuclear concerns continue to drag Japanese stocks
City Index April 12, 2011 4:12 PM
<p>Japan shares were trading lower today as fresh concerns about the post-earthquake and tsunami recovery emerged. There was also a high level of anxiety as […]</p>
Japan shares were trading lower today as fresh concerns about the post-earthquake and tsunami recovery emerged. There was also a high level of anxiety as Japanese officials upgraded the nuclear crisis level similar to that reached during the Chernobyl disaster in April 1986.
As in the past few days, stocks in car manufacturing companies including Honda and Nissan Corp, continued to be dogged by supply shortage concerns. Technology companies including Fujitsu and Sony Corp are also affected and were trading lower today.
Elsewhere in Asia, most of the markets were trading lower after a bit of a run during the past few days. In Hong Kong, energy stocks dragged the Hang Seng Index lower on the back of a sharp drop in crude oil prices overnight. Bank stocks were also dragged lower as monetary authorities in Hong Kong expressed concerns in what they described as high level of credit growth among some financial institutions.
South Korea’s central bank held rates steady today despite inflationary pressure building in their economy. The bank raised rates by 0.25% last month. The decision to keep rates unchanged at 3.0% comes despite inflation touching 4.7% in March.
We think the reluctance to increase rates is more an issue not wanting to do it in consecutive months as opposed to not needing to do it. A hike is likely in the next few months.
In Australia, the stock market was also affected by the negative sentiment in the Asian region. The All Ords Index was down about 1.7 per cent while the Aussie dollar gave up a few cents against the US greenback during the Australian trading session.
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