Asian Markets Slide on Naked Short-Selling Ban
New curbs on financial speculators were imposed by Germany's financial regulators last night, sending Asian shares sharply lower on concerns that the European debt crisis is nowhere near over. The move bans "naked short-selling," a tool investors use to sell shares they don't own, haven't borrowed and haven't ensured can be borrowed in the future. Some believe it is this kind of betting that can drive down the price of government bonds in places like Greece and Portugal, making it more difficult for those countries to borrow the money they need, according to the BBC.
In Japan, Nippon Sheet Glass, which gets nearly half its revenue from European sales, dropped 3.2%, and electronics makers also closed lower. Both Canon and Nikon fell 1.1% and Casio Computer dipped 1%. But Sony climbed 2.7%, Clarion, a maker of audio systems for cars, added 2.4% and Alps Electric, which makes electronics for cars, rose 1.6%.
Japanese car companies rose today. Isuzu racked up a 4.5% increase, Mazda advanced 2.1%, Honda added 0.8% and Toyota managed a 0.6% gain. Hino Motors, a maker of Japanese buses and trucks rallied 3%.
In China, exporters are keeping a careful eye on the European markets, girding themselves for a decline in orders. Shipping companies lost value on worries that business will slow. China Cosco declined 1.7%, China Shipping Development fell 1.5% and Cosco Shipping lost 1.4%.
Among Chinese Property developers, Poly Real Estate spiraled down 1.7% and China Vanke slid 1.1%, while Gemdale managed a 0.5% advance.
In Hong Kong, concerns about European debt combined with tightening monetary policies across the sea in China worried investors. Shares in oil exploration company Cnooc tumbled 4.3%, and Sinopec, an oil-processing company, sank 1.8%. Aluminum Corp. of China, often referred to as Chalco, slumped 5.9%.
Esprit, a Hong Kong clothing company that does loads of business in Europe, tumbled 5% after a document has revealed that former chairman Michael Ying, who is reportedly Asia's 13th richest man, sold his stake in the clothier in March, making him about $160 million, according to Bloomberg.
Foxconn, the world's biggest contract maker of mobile phones, lost 3.7% and China Merchants Holdings, which operates cargo terminals and toll roads, slid 4%.
The biggest loser on the Hong Kong exchange was Denway Motors, which plunged 24.1%. Denway shareholders have been offered a deal to buy them out by Guangzhou Automobile Group, which already owns 38% and would like to consolidate the two companies. But the offer fell short of shareholder expectations, says Bloomberg.
Evergrande, a Hong Kong-listed real estate company that has recently slashed prices on homes in China by 15%, tumbled 7.9%, while Glorious Property, another builder of luxury villas, tumbled 4.3%. Soho China, a designer of home offices in Beijing fell 2.8%.
Macau Casino operator SJM Holdings was among today's biggest winners, surging 6.2% after reporting a huge increase in revenue from recently added VIP tables for high-rollers, reports Bloomberg. With shaky markets across the region, the gambling table might be just the place to make a profit.