The Sun 2008102818 Hs Plunges 12.7 Nikkei At 26 Year Lows

18

theSun

| TUESDAY OCTOBER 28 2008

business news Hang Seng

S&P/ASX200

TSEC

11,015.84

3,809.2

4,366.87

1,602.54

60.2

212.76

KLCI

STI

Closed

Closed

KOSPI

946.45

7.70

NIKKEI

7,162.90

486.18

Hang Seng plunges 12.7%, Nikkei at 26-year lows HONGKONG/LONDON: Global stock markets continued to slide, led by a slump in Asian stocks to its lowest in four years. Hongkong shares plunged 12.7% in their biggest single-day drop since 1997 yesterday, Japanese stocks tumbled to 26-year lows and most other Asian markets fell heavily in chaotic trade as investors feared a flurry of central bank moves would not be enough to stave off a global recession.

The benchmark Hang Seng Index closed down 1,602.54 points at 11,015.84, its lowest level since mid-2004 and taking its losses so far this year to 60%. The index lost as much as 15% earlier, its largest one-day decline since 1987. Europe’s largest lender, HSBC shed 14.77% to HK$75, its lowest level in seven years and wiping US$20 billion off its market value. The stock plunged 12.5% on Friday after Morgan Stanley slashed its target price to HK$75 on growing signs of trouble in emerging markets. “There is panic selling in the market,” said Kenny Tang, associate director at Tung Tai Securities. “Investors are still bracing for the bottom.” The losses came as Japan’s Nikkei average fell 6.4% to its lowest in 26 years as the surging yen will further weaken the nation’s exports, hurting the economy. Banks tumbled on concerns they would need to lift their capital. “Banks are chronically under capitalised, which means credit rationing process is still very much likely,” said Tim Rocks, equity strategist with Macquarie Securities, Hongkong. Expectations that the US Federal Reserve will further trim its key interest rates this week to more than four-year lows failed to calm investors. ICBC, the world’s largest bank by market value, slid 11.11% after it reported on Friday a slower pace of growth in third-quarter earnings and posted bigger-than-expected impairment losses on subprime mortgage-linked assets.

Elsewhere in Asia, shares dropped between 4% and 10%, with only South Korea bucking the trend following a record interest rate cut of 75 basis points by its central bank. The Thailand share market was suspended for 30 minutes after it dropped more than 10% to a fiveyear low. It closed 10.50% lower. Meanwhile. European shares slumped in early trading yesterday, tracking big losses in Asia as intensified fears of a global recession hit banks and energy shares, while Volkswagen soared as Porsche raised its stake. By 0935GMT the FTSEurofirst 300 index of top European shares was down 4.4% at 793.52 points, adding to Friday’s decline of 4.9%. Banks took the most points off the European index. HSBC, BNP Paribas, Societe Generale and Banco Santander were down between 5.3-12.7%. “We are wallowing around in the sea of unknown. Until the capital market situation is eased and the money comes out of governments into the banking system we are not going to see anything different. Recession remains on everyone’s lips and is the top concern,” said Howard Wheeldon, strategist at BGC Partners. Energy shares were also lower. Crude fell by 3.5% as an emergency production cut by Opec was shrugged off by traders anxious about the onset of a deep global recession. “The falls in the commodity price despite the cuts reflect how weak Opec is in these circumstances. It shows how low global demand has become. Investors are not convinced there is going to be any pick up anytime soon,” said Justin Urquhart Stewart, investment director at Seven Investment Management. – Reuters

AirAsia to fly to India from Dec 1 KUALA LUMPUR: AirAsia Bhd will fly to India beginning Dec 1 with its inaugural flight to Thiruchi in the South Indian state of Tamil Nadu. AirAsia group chief executive officer Datuk Seri Tony Fernandes said the airline expected a huge growth from Indian tourism to contribute to its new route. “I anticipate very high load factor for this flight (probably) about 90% from the first week, which should probably be the strongest route we have ever done,” he told a media briefing here yesterday. He said there was a huge potential for the airline as Thiruchi was the fourth largest city in Tamil Nadu with a population of 1.6 million. Thiruchi, famous for its fusion architecture and monuments, will be the first destination for AirAsia, before it embarks on nine other locations in India within the next one-and-a-half years. Other routes include Madras, Cochin, Madurai and Kovaibutore while for AirAsia X, they are looking at New Delhi, Mumbai and Hydrabad. Tony said to cater to the new routes, the carrier would be spending about RM5 to RM7 million for new infrastructure including the opening of an office in Thiruchi. Booking for the flight, which will be on a daily basis, will start on Wednesday midnight with offer price starting from RM49 while an average fare price of RM200 for one-way flight. For India, AirAsia would be using 10 A320 planes. – Bernama

‘MIEA has taken steps to help members remain competitive’ by Bernard Cheah [email protected]

GEORGE TOWN: The Malaysian Institute of Estate Agents (MIEA) has taken initiatives to assist its members to be actively involved in international marketing to overcome the impending difficult times caused by the economic slowdown. “We want to encourage our members to be involved in promoting international marketing. It is our ability to adapt to the challenges ahead that is crucial to help us remain competitive,” MIEA Penang chapter chairman Danny Ooi said in a press statement. He said a day-long conference was held in conjunction with the official visit by a 50-member delegation from North Sumatra Real Estate

Indonesia (REI), headed by its chairman Rusmin Lawin, on Sunday. Among those who spoke at the conference include Lawin, Rehda Penang chairman Datuk Jerry Chan and Fiabci International marketing and networking vice-president Michael Geh. Ooi said the inaugural visit would enhance the working ties and cooperation established under the Indonesia-Malaysia-Thailand Growth Triangle (IMT-GT). He expressed hope the ties between REI and MIEA would help to upgrade the quality of professional services provided by estate agents in their respective countries. “The interaction with REI was also in line with the upcoming private-public sector efforts to market Malaysian properties overseas,”

said Ooi. MIEA and REI signed a memorandum of understanding to explore areas of cooperation and collaboration and foster inter-regional ties. Ooi said he was made to understand that Malaysia was undertaking an aggressive drive to carry out road shows overseas with the active participation of local developers. On a different note, Ooi advised house buyers to be wary of illegal estate agents touting for business to minimise fraud. “There had been many instances of buyers being cheated of their deposits and receiving substandard services,” he said. He said it is a punishable offence to act as an estate agents without accreditation.