Bank of Japan Keeps Interest Rate Near Zero, Asian Markets Slide Lower
Shares in Japanese exporters fell today after another rise in the value of the yen. Policymakers at the Bank of Japan emerged from a two-day meeting held to assess the impact of recent steps taken to prop up the ailing economy, but the decision to maintain a key interest rate of 0.1% did little to imbue the public with confidence. Investors are looking for proof that Japan is on the road to recovery, and a strengthening yen sends exactly the wrong message.
Exporters tumbled with Casio Computer diving 4.4%, Canon sinking 2.1% and Sony losing 2.2%. Pioneer plunged 4.6% and TDK slid 3.2%. Advantest, an exporter of semiconductor testing equipment nosedived 4.4%, while Alps Electronics, a maker of electronic components for the auto industry, declined 4%. Trend Micro, an antivirus computer software maker lost 3.4%.
Among car companies dependent on a beneficial exchange rate when they repatriate their earnings, Toyota plunged 3.6%, Mazda shed 3.1%, Honda slumped 2.5%, Nissan Motor fell 2.2% and Isuzu declined 2.1%.
In Hong Kong, Yeebo International Holdings was among the top performers. The LCD maker surged 21.2% after announcing they'd secured approval from the China Securities Regulator for the IPO of the electrolytic capacitor company, Nantong Jianghai Capacitor, of which Yeebo holds a 50% stake.
China Mobile shares tumbled after Vodafone announced plans to sell its stake in the phone carrier. According to Bloomberg, Vodafone will walk away after nearly doubling its investment. China Mobile stock dropped 3.8% and was accompanied by a slide in other telecom shares. China Unicom slumped 4.2% and Tencent declined 1.1%.
Among Hong Kong-listed retail businesses China Resources, with enterprises ranging from food production to clothing sales, sank 3.4%. Esprit slid 2.9% and Li & Fung fell 1.6%. Belle International, newcomer to the Hang Seng and operator of the Joy & Peace shoe shop chain -- a staple in just about every Hong Kong mall and shopping arcade from Admiralty to Tsim Sha Tsui, closed down 2.9%.
In Shanghai, real estate companies pulled the index lower as investors speculated that more moves to curb the property market could be on the way, and could include halting loans to property developers. Today Poly Real Estate suffered a 2.8% fall, China Vanke gave up 2.4% and Gemdale retreated 2%. While property stocks slide lower, the price of real estate just isn't coming down enough to satisfy officials.