BANGKOK (AP) — Asian stock markets overcame early losses to mostly gain Wednesday as investors hoped for good news from the slew of corporate earnings reports due soon in the U.S.

Oil prices fell to near $85 a barrel while the dollar was stronger against the euro and the yen.

Asian stocks initially slipped after Slovakia, one of the smallest members of the 17-nation grouping that uses the euro, blocked a measure to expand the region’s financial rescue program for heavily indebted countries. The move intensified worries that a failure by Europe to contain its debt crisis could lead to a massive debt default by the Greek government.

Japan’s Nikkei 225 index dropped 0.3 percent to 8,745.57. But other major indexes reversed course. Hong Kong’s Hang Seng rose 0.6 percent to 18,255.23 and South Korea’s Kospi added 0.2 percent to 1,798.82. Benchmarks in Singapore and mainland China also swung into positive territory.

In Hong Kong, sentiment was helped by a government pledge to expand the supply of affordable housing for low- and middle-income residents. Blue chip real estate stocks in Hong Kong welcomed the news. China Vanke Co. rose 2.4 percent, Poly Real Estate Group jumped 3.2 percent, and China Overseas Land & Investment Ltd. gained 1 percent.

China’s Shanghai Composite Index rose 2.2 percent to 2,399.18, two days after a government investment fund announced it had bought shares in major banks, helping to bolster the country’s sagging stock market.

The banks’ Hong Kong-listed shares continued to pile on gains. Industrial & Commercial Bank of China gained 1.2 percent, Agricultural Bank of China added 1.3 percent, and China Construction Bank rose 2 percent.

But in Japan, shares of Honda Motor Co. and Toyota Motor Corp. fell, a day after the companies said some vehicle manufacturing in Thailand had to be suspended due to flooding. Honda lost 2.1 percent and Toyota was down 0.9 percent.

Benchmarks in Australia, Taiwan and Thailand were also lower.

Many analysts hope that the upcoming wave of U.S. corporate earnings reports will pull investor focus away from Europe and back to the health of American companies.

PepsiCo Inc., one of the world’s largest food and beverage makers, is expected to report an uptick in profit Wednesday when the food and beverage maker releases its fiscal third-quarter results.

The results are being closely watched for clues as to what U.S. consumers are willing to spend their money on, which plays a critical role in the U.S. economy.

“If the U.S. corporations miss their estimates for the third quarter, then we will see selling pressure” on markets, according to Castor Pang, head of research at Core Pacific-Yamaichi in Hong Kong.

On Tuesday, Slovakia’s parliament rejected a bill that would have strengthened the powers of a regional rescue fund to help bail out strapped economies in the eurozone.

The 16 other countries that use the euro have already signed off on the bill, but the measure requires unanimous support.

There are ways around Slovakia’s opposition, but the move temporarily sets back efforts to address Europe’s debt jam, which has been the most important issue for financial markets for months.

Such worries have caused investors globally to dump stocks, according to Cambridge, Mass.-based fund tracker EPFR Global.

Eight of the nine major equity fund groups tracked by EPFR posted outflows during the week ending Oct. 5. Investors withdrew a net $11.57 billion from equity funds, the third-worst weekly tally this year.

On Tuesday, the Dow Jones industrial average ended down 17 points after moving between small gains and losses throughout the day.

The Dow lost 0.1 percent to close at 11,416.3. The Standard & Poor’s 500 index rose 0.1 percent to 1,195.54, and the Nasdaq composite rose 0.7 percent to 2,583.03.

Benchmark crude for November delivery was down 73 cents at $85.08 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 40 cents to settle at $85.81 in New York on Tuesday.

In currencies, the euro fell to $1.3616 from $1.3669 late Monday in New York. The dollar strengthened slightly to 76.69 yen from 76.66 yen. — AP

China’s shares fell to their lowest levels in nearly 30 months as pessimism about the country’s economy and combined with tight liquidity ahead of China’s National Day holiday break that will close markets there all of next week.

“It’s hardly surprising that traders are looking to book short-term profits,” said Ben Potter, strategist at IG Markets in Sydney. “No one has any confidence in trying to let profits run by holding positions over the weekend; there’s simply too much uncertainty in the world at the moment.”

Hong Kong’s Hang Seng Index dropped 2.3% to 17592.41, led by losses in Chinese banks and property plays. Its losses for the quarter hit 21%, accounting for most of the index’s 24% loss so far this year. China’s Shanghai Composite, which slipped 0.3% to 2359.22 on Friday, slumped 16% for the quarter. India’s Sensex lost 1.5% to 16453.76, part of its 13% loss over the quarter.

Japan’s Nikkei Stock Average ended fractionally lower at 8700.29, bringing the quarter’s losses to 11%. Australia’s S&P/ASX 200 and South Korea’s Kospi Composite both were fractionally higher on the day, at 4008.60 and 1769.65, respectively, but also deep in the red for the quarter.

Soft data in the region on Friday underscored investor fears about a double-dip recession for the global economy.

Private-sector credit in Australia rose only 0.2% in August, while industrial production in Japan and South Korea was weaker than expected. The HSBC China Manufacturing Purchasing Managers Index for September stayed at 49.9, steady with August’s level, but still showing contraction in manufacturing activity.

Southeast Asian markets, hit particularly hard in September as foreign funds pulled out over worries that the West’s problems will cripple growth, ended Friday mixed. Indonesia’s benchmark was up 0.3% to 3549.03, Thai shares lost 1.1% to 916.21 and Singapore stocks slumped 1.2% to 2675.16.

Among individual stocks, mainland developers fell in Hong Kong on worries about a correction in property prices. China Resources Land tumbled 8.5% to HK$8.49 to become the worst-performing blue-chip of the day.

They brought down banks, as investors worried that a significant correction in property prices could mean an accumulation of bad debt from the developers. China Construction Bank dropped 5.7%, Bank of Communication fell 4.9% and Bank of China declined 4.7%, all in Hong Kong.

Many exporter and financial stocks were battered over the quarter. In Japan, shares of Nomura Holdings skidded 28% since end-June, including a 1% drop on Friday, while Sony plunged 29%, and HSBC dropped 22% in Hong Kong.

Fears that China’s growth will slow sharply and damage Australia’s resource-rich economy pressured that sector: BHP Billiton fell 20% in the quarter, while Rio Tinto tumbled 25%.

Asian currencies weren’t spared from the quarter’s sell-off, triggering intervention from South Korea to India to Thailand. The Korean won was among the biggest losers, dropping 9.5% against the U.S. dollar during that time, and South Korea’s currency authorities sold dollars in what traders described as some of the most aggressive intervention since the 2008 financial crisis.

The New Zealand dollar fell sharply Friday after Standard & Poor’s Ratings Services and Fitch Ratings both downgraded the country’s debt, citing its worsening external-debt position and the costs of earthquake recovery. The downgrades underscored that even nations with a relatively stronger debt profile face economic challenges as global growth falters and governments come under increasing fiscal strain.

Its benchmark stock index, however, rose 1.3% to 3343.35, pushing its performance for the year back into positive territory. — The Wall Street Journal

Benchmark oil hovered above $81 a barrel while the dollar dropped against the euro but was steady against the yen.

Japan’s Nikkei 225 index shed 0.2 percent to 8,602.96 and Australia’s S&P/ASX 200 fell 1.2 percent to 3,989.70. Markets in Hong Kong were closed due to an approaching typhoon.

Mainland China’s Shanghai Composite Index lost 0.5 percent to 2,380.34 and the smaller Shenzhen Composite Index dropped 1.5 percent to 1,016.63.

But South Korea’s Kospi rose 1.8 percent to 1,753.52. Benchmarks in Malaysia, Taiwan, Indonesia and the Philippines were also higher while India and Singapore were down.

Investment sentiment was dented after German Chancellor Angela Merkel late Wednesday suggested that a second bailout package for Greece might have to be renegotiated. Several European leaders want banks to take bigger losses on Greek bonds. France and the European Central Bank oppose the idea.

Earlier this week, financial stocks were buoyed by hopes that a plan was in the works to prevent Greece from defaulting on its debts — an event that some fear would crush banks with significant holdings of the country’s bonds and cause domino-style defaults in other indebted countries such as Italy.

“One of these days, they will manage to get something onto paper. But at the moment, it feels like a big swinging match,” said Ben Potter, market strategist at IG Markets in Melbourne. “Markets always sell off further than they should and snap back further than they should.”

“I think people sort of have fallen into the trap of thinking, ‘The market is rallying, so something good must be happening,’” he said.

Raw materials companies were among the biggest decliners in Asia after prices for commodities like copper and oil fell sharply. Investors fear that Europe’s problems could cause the global economy to slip into another recession, weakening demand for basic materials.

Japanese energy explorer Inpex dropped 1 percent. Nippon Steel fell 3.5 percent. In Australia, mining giants BHP Billiton fell 2.1 percent while Rio Tinto lost 3.3 percent. Newcrest Mining Ltd., the country’s biggest gold miner, fell 2.9 percent.

But technology companies fared better, following on the heels of U.S. tech shares.

South Korea’s LG Electronics soared 12 percent and Samsung Electronics, the world’s top global manufacturer of flat screen televisions, memory chips and liquid crystal displays, rose 4.1 percent. Hynix Semiconductor Inc. gained 5.4 percent.

Shares of POSCO, South Korea’s leading steelmaker, rose 2.2 percent as the company announced the start of work on a cold-rolled stainless steel plant in Turkey, Yonhap news agency said.

Tokyo Electric Power Co., meanwhile, tumbled 12.17 percent following Japanese media reports that a government panel has estimated that compensation payments related to a nuclear leak following the March earthquake and tsunami disaster could reach as high as 5 trillion yen.

On Wall Street on Wednesday, the Dow Jones industrial average fell 1.6 percent to close at 11,010.90. The Standard & Poor’s 500 index fell 2.1 percent to 1,151.06. The Nasdaq composite index fell 2.2 percent to 2,491.58

The decline followed three days of gains. Stocks rose earlier this week on hopes that Europe was moving closer to resolving its debt problems. The Dow soared 272 points on Monday, its fourth-largest increase this year, and another 147 points on Tuesday.

Benchmark crude for November delivery rose 3 cents to $81.24 per barrel on the New York Mercantile Exchange. The contract fell $3.24, nearly 4 percent, to $81.21 per barrel on the Nymex on Wednesday.

Oil rose sharply earlier this week on optimism Europe was getting a better handle on its debt crisis.

In currencies, the euro rose to $1.3617 from $1.3582 late Wednesday in New York. The dollar was unchanged at 76.53 yen. — AP

“This type of move was inevitable. Traders are now facing up to fact that central banks could be coming to the bottom of the rescue measures barrel,” said Kara Ordway, a currency strategist at City Index in Sydney.

The G-20 pledged to take “strong and coordinated” action to stabilize the global financial system, with shares also getting a boost from reports that China’s national pension fund received approval to inject more than $1.56 billion into the stock market.

Still, “there appeared to be nothing in the way of concrete new action and markets were generally underwhelmed,” said Sue Trinh, a senior currency strategist at RBC Captial Markets

Australia’s S&P/ASX 200 index ended down 1.6% at 3903.20 after briefly trading in positive territory, while South Korea’s Kospi lost 5.7% to end at 1697.44. Hong Kong’s Hang Seng Index ended down 1.4% at 17668.83, after trading down as much as 3%, and the Shanghai Composite Index was 0.4% lower at 2433.16. India’s Sensex was down 1.2% in afternoon trade. Japan’s markets were closed for a holiday.

DJIA futures were up 49 points in screen trade.

Indonesian shares ended up 1.7% after plunging 8.9% Thursday. Among other Asean markets, Philippine shares ended down 5.1%, the biggest one-day percentage drop in nearly three years, while Thai shares fell 3.5% in afternoon trade.

Growth-sensitive commodity plays continued to bear the brunt of the selling amid sharp drops in metals prices. Heavyweight BHP Billiton dropped 3% in Sydney and Posco shed 6.2% in Seoul. In Hong Kong, Jiangxi Copper dropped 2% and its Shanghai-listed shares fell 3.3%.

“The triple-whammy of weak [manufacturing purchasing managers' index] in China and the euro zone, plus a downbeat assessment from the Federal Reserve about the long-term economic outlook has sparked sharp falls in commodity prices in the last 24 hours,” said economists at Capital Economics.

In Hong Kong, Swire Pacific was the worst performer among blue chips, falling 6.4% after it said late Thursday it is reconsidering spinning off its property arm by listing it in Hong Kong by way of introduction, meaning it won’t raise any money through the listing. — The Wall Street Journal

Thailand listed real estate firms are extremely undervalued at the moment Sansiri, Supalai, Asian Property, Apex are quality companies with strong balance sheets and a very positive outlook.

Sansiri Public Company Limited (Sansiri) is a Thailand-based company engaged in real estate business. The Company is principally engaged in property development with its properties consisting of land and housing projects, residential condominium projects, serviced apartments for rent, and office buildings for rent. Other activities include the provision of building management service and real estate brokerage and provision of other services, such as hotel, medical spa and education business. In addition, Sansiri operates a school under the name Satit Pattana School. As of December 31, 2009, the Company operates a 46-key hotel named Casa del Mare, locating on the area of 3 Rai 2 Ngan and 51 Square Wah in Hua Hin District of Prachuap Kiri Khan province. It also operates medical spa business through its subsidiary, Papanan Limited under the brand S Medical Spa. It has 18 subsidiaries.

Supalai Public Company Limited operates property development business. The Company develops single houses, condominiums and apartment buildings for sale and rental. Additionally, the Company owns and operates the Supalai Pasak Resort Hotel.

Asian Property Development Public Company Limited is a Thailand-based company engaged in the property development business. The Company focuses on the development and sales of residential projects that serve the needs of middle to high income markets, including townhouses, single detached houses and condominiums. It operates residential projects under the brands Baan Klang Krung, Baan Klang Muang, The City, THE ADDRESS, Life, Rhythm and others, which all are located in the Bangkok metropolitan areas and its surroundings. As of December 31, 2010, the Company had 10 subsidiaries: Asian Property (Bangkok) Company Limited, Asian Property Company Limited, The Value Property Development Company Limited, Signatures Advisory Partners Company Limited, Trillion Development Company Limited, Bangkok Smart City Company Limited, Asian Property (Sukhumvit) Company Limited, Smart Service & Management Company Limited, AP (Ratchada) Company Limited and AP (Sathorn) Company Limited.

Apex Development Public Company Limited, is headquartered at 10/53 2nd Floor, The Trendy Building, Sukhumvit 13, Sukhumvit Road, Wattana District, Bangkok. The former name was Suntech Group Public Company Limited which the court authorized on April 30, 2007 to be released from its rehabilitation plan and to return to normal commercial business.

In August of 2007, the company increased its registered capital via a new group of investors led by Mr. Pongphan Sampawakoop, who bought 836,000,000 shares or 78 % of the outstanding shares. The new group changed the company name to “Apex Development Public Company Limited” and changed the business category to the “property development” sector with its SET symbol as APX. Apex’s new executive management team is led by Mr. Pongphan Sampawakoop who has more than 30 years experience in property development whose its goal is to maximize growth and profit for stock holders. The company has now started several property development projects according to its new objective.

In late 2007, Apex undertook three new projects in its new resort, White Sand Beach in a new five-star location at Jomtien Beach, Pattaya, (at Sukhumwit Road km. 156.5). Covering an area of 30 rai, this luxury complex has direct access to Sukhumwit Road and a beautiful white sandy beach. The resort comprises three main projects:

Mövenpick Spinnaker Residences – Beachfront High-rise Condominium with Utmost Privacy and Panoramic Ocean View
Mövenpick Resort & Spa – True Excellence In Swiss Hospitality
Mövenpick Pool Villas - Absolute Modern & Convenient Living

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In Manila today the Philippine Stock Exchange index added 9.64 points or 0.21 percent to 4,485.65, closing at a record high for the third day in a row.

The mining/oil counter continued to outperform other sectors, rising by 4.89 percent. The financial and industrial counters also ended in positive territory, making up for the slump in the holding firms, property and services counters.

Turnover was heavy at nearly P7 billion. The index, however, was fueled by selected buying. Despite the overall index gain, the 71 advancers in the overall market were slightly outnumbered by 73 decliners while 48 stocks were unchanged.

The index was led higher by Lepanto “A” (reserved for local investors) and “B” (open to both local and foreign investors), Metrobank, URC, Philex, BPI and ICTSI. Non-index stocks San Miguel, Semirara, Boulevard Holdings, Atlas, Manila Mining and Petron also gained in active trade.

On the other hand, index gains were tempered by the profit-taking on BDO, EDC, PLDT, Aboitiz Power and SM Investments. Non-index stock East Asia Power, a favorite in previous days, also succumbed to profit-taking.

Shayne Heffernan
Shayne Heffernan oversees the management of funds for institutions and high net worth individuals.
Shayne Heffernan holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.
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Stocks were already lower when the People’s Bank of China announced it was raising its benchmark rate for one-year loans by 0.25 percentage points to 6.56 percent to keep a lid on rising inflation levels.

In May, inflation hit a 34-month high of 5.5 percent and is believed to have risen further in June even as an overheated economy cools gradually under the pressure of investment curbs and other controls.

The increase was the fifth since October and reinforced concerns that the world’s second biggest economy will slow down sharply. China has been one of the main pillars of the global recovery from recession.

“China’s announcement isn’t helping investor spirits,” said Sal Guatieri, an analyst at BMO Capital Markets.

Guatieri said investors were already “smarting” from Moody’s four-notch downgrade of Portugal’s credit rating to junk status on Tuesday.

The agency said Portugal will find it difficult to meet its targets and that like Greece it may need a second bailout.

Portugal needed a euro78 billion ($112 billion) bailout from its European partners and the International Monetary Fund earlier this year after markets began charging it unsustainably high interest on loans as investors deemed the country a risk.

“This will weaken hopes that the recently agreed aid for Portugal will put a line under the nation’s woes and could trigger worries that Portugal could follow Greece down the path of possible default,” said Jane Foley, an analyst at Rabobank International.

The combination of the China rate hike and the Portuguese rating downgrade sent already-depressed stocks in Europe even lower and added to the pessimism over Wall Street’s open.

In Europe, the FTSE 100 index of leading British shares was down 0.7 percent at 5,981 while Germany’s DAX fell 0.3 percent to 7,419. The CAC-40 in France was 0.5 percent lower at 3,959.

Portuguese stocks were hit hardest by the Moody’s warning, with Lisbon’s stock market down 2.5 percent. Bank shares took the brunt of the sell-off, with Banco Comercial Portugues losing more than 5 percent.

The euro was also hit hard, trading 0.7 percent lower on the day at $1.4326.

In the U.S., Dow futures were down 0.3 percent at 12,493 while the Standard & Poor’s 500 futures fell 0.5 percent to 1,330.

Over the past week or so, stocks have risen as concerns over an imminent debt default in Greece waned following Parliament’s approval of austerity measures demanded by international creditors. A positive U.S. manufacturing survey last Friday also helped sentiment recover ahead of a raft of economic news this week.

This week’s data culminates in Friday’s June nonfarm payrolls data, which often set the market tone for a week or two after their release. Later Wednesday, investors will have the monthly ADP payrolls report to digest as well as the Institute for Supply Management’s survey into the non-manufacturing sector.

Not all the attention will center on the U.S. this week, though.

On Thursday, the European Central Bank is expected to raise its main interest rate by a quarter percentage point to 1.5 percent, its second hike since April as it tries to rein in above-target inflation levels.

Earlier, sentiment in Asia held up.

Japan’s Nikkei 225 index rose 1.1 percent to end at 10,082.48 — above the psychologically important 10,000 mark for the second time this week — while South Korea’s Kospi rose 0.4 percent to end at 2,171.19. Hong Kong’s Hang Seng Index fell 1 percent to close at 22,517.55.

Mainland Chinese shares were mixed — they closed before the People’s Bank made its announcement.

The Shanghai Composite Index lost 0.2 percent to finish at 2,810.48, while the Shenzhen Composite Index gained 0.4 percent to 1,200.58.

In the oil markets, the retreat in stock markets hit prices. Benchmark oil for August delivery fell 86 cents to $96.03 a barrel in electronic trading on the New York Mercantile Exchange. — AP

Oil prices hovered below $95 a barrel while the dollar rose against the yen and the euro.

In early European trading, Britain’s FTSE 100 rose 0.1 percent to 6,023.49 and Germany’s DAX was 0.2 percent higher at 7,455.62. France’s CAC-40 dropped 0.3 percent to 3,991.81.

Wall Street appeared poised for a mixed opening after a three-day holiday weekend. Dow Jones industrial futures rose 0.1 percent to 12,531 and S&P 500 futures slipped less than 0.1 percent to 1,334.10.

Earlier in Asia, Japan’s Nikkei 225 index rose narrowly to 9,972.46, a two-month closing high.

South Korea’s Kospi rose 0.8 percent to 2,161.75. Samsung Electronics Co., the top global manufacturer of flat screen televisions, memory chips and liquid crystal displays, rose 2.4 percent. Hynix Semiconductor Inc., one of the world’s leading memory chip makers, jumped 3.9 percent.

With Wall Street closed Monday for a holiday, markets were focused on Greece. Sentiment last week was buoyed after the country’s lawmakers backed austerity measures required from international creditors in return for emergency cash, which diminished fears of a broader European crisis.

That changed Monday, however, when credit ratings agency Standard & Poor’s warned that a proposal by French banks to help Greece with its financial crisis would likely amount to a debt default.

Some analysts said they believed that a Greek default was inevitable, no matter what aid was provided, and that such a default had already been factored into markets.

“The S&P is doing the right thing because Greece is really not able to pay its debts. That is why they should be in default, even though there are rescue packages,” said Jackson Wong, vice president at Tanrich Securities in Hong Kong. “We already know this fact, so it was a little bump in the situation.”

Hong Kong’s Hang Seng slipped 0.1 percent to 22,747.95, with banking shares sliding after Moody’s Investor Service said Beijing’s estimate of local government debt was likely too low — raising concerns that Chinese banks could be hurt if borrowers cannot repay loans.

Shares of Hong Kong-listed Industrial and Commercial Bank of China, the world’s biggest bank by market value, dropped 0.5 percent. China Construction Bank Ltd., the country’s third-biggest commercial lender, lost 1.2 percent.

While a majority of loans to local Chinese governments are assumed to be of good quality, “we conclude that the banks’ exposure to local government borrowers is greater than we anticipated,” a Moody report quoted vice president Yvonne Zhang as saying. The agency views the outlook for the Chinese banking system “as potentially turning to negative.”

Benchmarks in Australia, New Zealand, Singapore and Indonesia were also lower.

But the Shanghai Composite Index gained 0.1 percent to 2,816.36 and the Shenzhen Composite Index added 0.6 percent to 1,195.83. Shares in chemicals were buoyed by speculation that half-year results will be better than earlier forecast.

China Vanke, the industry leader in real estate, gained 1.5 percent after reports said its sales in January-June exceeded the total for all of 2009. Yongtai Technology hit the daily 10 percent limit.

Attention will turn to U.S. jobs data Friday. After a string of mostly poor economic indicators in recent weeks, investors will be looking for indications that the U.S. recovery is getting back on track.

On Thursday, the European Central Bank is expected to raise its main interest rate by a quarter of a percentage point for the second time since April.

Benchmark oil for August delivery was down 25 cents at $94.70 a barrel in electronic trading on the New York Mercantile Exchange. Crude last settled down 48 cents at $94.94 on Friday.

In currencies, the euro dropped to $1.4487 from $1.4511 late Thursday in New York. The dollar strengthened to 81.10 yen from 80.84 yen. — AP