Apr 1, 2008

International Markets - 31st March 2008 - March Madness set to continue April

March Madness set to continue April

Asian markets ended a first week of the day with on a negative note as the Japanese stocks dragged down by financials such as Mizuho Financial Group on worries about global credit markets, while exporters such as Honda Motor Co. in the wake of a drop on Wall Street and a stronger yen.

The Nikkei 225 Average fell 2.3% to 12,525.54 in Tokyo, while the broader Topix index lost 2.5% to 1,212.96.

According to the official data released by the Ministry of Economy, Trade and Industry, Japans industrial output dropped 1.2% in February from the previous month, marking the second straight month of declines.

In another release the housing starts in Japan fell for the eighth straight month in February although the pace of decline has slowed, signaling the easing impact of tighter building rules. The Ministry of Land, Infrastructure and Transport said housing starts dropped 5.0% to 82,962 units in February from a year earlier, after declining 5.7 % in January. It is the best reading since June 2007 when housing construction rose 6.0 percent. The annualized rate of housing starts dipped to 1.15 million units in February from 1.19 million units in the previous month.

China's Shanghai Composite dropped 3% to 3,472.71, reflecting disappointment after the government didn't announce any new measures to support the beaten-down stock market, as rumored on Friday. The index ended 4.9% higher on Friday on speculation regulators might announce the introduction of index futures trading.

In Hong Kong, the Hang Seng Index dropped 1.9% to 22,849.20 and the Hang Seng China Enterprises Index dropped 2.8% to 12,083.30.

Elsewhere, S&P/ASX 200 index fell 0.1% to 5,355.70, after rising as high as 5,375 earlier in the day, while South Korea's Kospi also retreated from highly volatile trading day ending the day up by 0.13% to 1,703.99. New Zealand's NZX 50 rose 0.7% to 3,470.43; Singapore's Straits Times Index slipped 1.07% to 2,999.42 and Taiwan's weighted index lost 0.6% to 8,572.59.

In the afternoon trading, India's Sensex skid down by 4.1% to 15,687.47, while the broader S&P CNX Nifty index lost 3.8% to 4,753.80.

In currency trading, the U.S. dollar was quoted at 99.64 yen in Asia, compared with 99.40 yen in New York late Friday.

May crude oil futures fell as much as $85 cents to $104.77 a barrel in electronic trading, after losing $1.96 to settle at $105.62 a barrel Friday on the New York Mercantile Exchange.

Meanwhile European stocks dropped in an opening trade, with telecom leading the market lower after a critical brokerage note and with UBS lower on further worries about potential write-downs.

In the opening trade the U.K. FTSE 100 index was down by 0.9% to 5,639.50 followed by the German DAX 30 index, which by declined 1.3% to 6,473.34. The French CAC-40 index slid 1% to 4,648.30.

On the data release side we had the money supply measured by M3, which grew at a slower-than-expected pace across the euro-zone in February. M3 - a broad measure of money supply closely watched by bank policymakers grew at an 11.3% monthly pace in February.

Meanwhile consumer price inflation in the euro-zone rose at 3.5% annual pace in March, accelerating from the 3.2% rate seen in February 2008. The inflation figure still remains well above the European Central Bank's medium-term cap of 2% adding concern to the officials who are scheduled to meet on 10 April 2008.


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