Extreme Asian Weather Sends Energy Shares North, Foxconn Continues to Rise
Shares were mixed in Asia Wednesday. Hong Kong's Hang Seng Index climbed 0.6% to 22,417 and in Japan, the Nikkei 225 Index rose 0.5% to 10,731. Meanwhile, China's Shanghai Composite Index lost 0.9%, ending the day at 3,254.%%DynaPub-Enhancement class="enhancement contentType-HTML Content fragmentId-1 payloadId-61603 alignment-right size-small"%% In Hong Kong energy and coal shares soared today as extreme weather in China sent the mercury down to the lowest temperatures Beijing has experienced since 1971. Temperatures are falling as low as -17C (1F) in Beijing and -35C (-31F) in Harbin, where the annual ice and snow festival famed for its intricate ice sculptures became a truly frigid affair. Many Chinese headed indoors to keep warm, and shares in heating-related companies headed north. Hong Kong-listed China Coal Energy Co. spiked up 5.3%, Yanzhou Coal Mining climbed 3.2% and coal miner China Shenhua Energy (CUAEF) rose 2%.
Also in Hong Kong, shares in mobile phone maker Foxconn (FXCNY) shot up for the third day this week, rising 7.9%. Rumors that the company and other subsidiaries of its Taiwanese parent company, Hon Hai Precision Industry, have been been tapped to make parts for the fabled Apple Tablet have sent shares soaring, and today Digitimes.com is reporting that Foxconn is expected to ship 12 million LCD TVs in 2010 filling major orders from Samsung. This will be a 10 million unit increase from last year and make Foxconn the second largest Taiwanese TV contract manufacturer.
Hong Kong property developers slid today after a government announcement that credit for the purchase of second homes will be curbed in an effort to stem property speculation. New World Development dropped 2.2% and China Resources Land fell 0.9%.
In Japan Nintendo (NTDOY) surged 6.9% after announcing record sales for its Wii game console. According to the Financial Times, the company sold about three million units last month -- nearly a million more than the previous month. Sony, maker of the PlayStation 3 gained 0.9%.
Japan Airlines (JALSY) gave back some gains from earlier in the week losing 6.7% in today's trading. Excitement about a possible rescue by Development Bank of Japan faded as the bank, along with the Ministry of Finance, proposed that bankruptcy may be the best way to restructure the ailing airline. According to Bloomberg, the company's negative net worth could be as much as 800 billion yen.
Toyota Motor benefited from an increase in December U.S. sales, which were up 32% from a year ago -- its stock rose 2.5% today. Honda's sales were reportedly up 25% from a year earlier, but it's stock closed down 0.2% today. Clarion Co, which makes car audio equipment surged 6.5% after reporting profits of about 400 million yen, according to Reuters. The company reported losses for the same period last year. Clearly the direction that Japanese companies are hoping to head this decade.