Li & Fung Plunges 10% in Hong Kong, Nintendo Climbs Higher on 3DS Technology
Hong Kong's Hang Seng Index slid 1.1% to 20,779 and China's Shanghai Composite Index fell 1.2% to 3,019. In Japan the Nikkei 225 Index inched up 0.1% to close at 10,829.
In Hong Kong, Li & Fung, clothing supplier to America's massive Wal-Mart and Target chains, plunged 10.7% after missing earnings estimates for last year. The company only racked up $434 million in net income as compared to the expected $483 million, according to Bloomberg. The company's sales have fallen 6%, due to low U.S. consumer demand and tight retail inventories. So if you're having trouble finding those size 10 loafers at your favorite department store, it just may be that they never had any to begin with, or have sold the only pair they ordered.
In contrast, Huiyin Household Appliances, which relies instead on Chinese consumers, leaped 44.4% in its Hong Kong debut today. The company's selection of products includes air conditioners, fridges, TVs and washing machines that are sold in about 360 locations in 27 Chinese cities. According to Business Week, China's Ministry of Commerce will aim to promote policies allowing customers to swap old products for new ones -- a sort of washing machine or fridge upgrade policy -- which could mean more traffic for the appliance maker. In a culture where new is nearly always seen as better, this sounds like a good bet.
Another big gainer today was China Resources, which is involved in businesses from beer and food distribution to property and retail. The company gained 5.3% in today's trading after announcing a 25% rise in profits for 2009.
Chinese cargo companies dragged the index lower. China Shipping Container Lines slumped 1.9% and COSCO Shipping fell 1.7%. China Merchants Energy Shipping, which transports crude oil, coal and other resources also dropped 1.8%.
Real estate continues to be a hot topic as the Chinese central and regional governments consider more measures to curb property speculation. In addition to new rules and regulations about speedy payment for property purchases, property taxes may be making an appearance soon. Today Chinese developers dipped with Gemdale slumping 2.1%, Poly Real Estate falling 1.9% and China Vanke dropping 1.7%.
In Japan, gainers included transportation company Nippon Express, which surged 2.9%, Fanuc, which makes robots for automated factories, shot up 3.9% and Advantest, maker of semiconductor testers, climbed 2.7%.
Among car companies Isuzu gained 1.6% and Honda advanced 1.2%.Toyota dipped 0.3%.
Sony, maker of the PS3, slumped 2.1% while its competitor, Nintendo, added a 5.3% increase to yesterday's 8.7% gain. Investors are predicting massive sales of the company's soon-to-be-released 3DS portable game console, which has the super-cool 3D feature working without any silly glasses. According to the company's press release, a total of 125 million regular DS units were sold in 2009, so sales of the 3D version could be fantastic if the technology really is cool enough to break through the recession mindset all over the world.