Most of Asian markets closed the week in a negative zone, with Japanese stocks extending their decline on Toyota Motor Corp., after the automobile giant reported a drop in quarterly profit and forecast its annual earnings will weaken. Higher crude-oil prices lifted stocks of energy producers in Tokyo and Sydney, but hurt shares of refineries in China and Hong Kong.
The Nikkei 225 Average dropped 2.1% to 13,665.34, and the broader Topix index lost 2.3% to 1,341.76. On the data release front Japan`s foreign exchange reserves registered a first drop in 11 months due to a weaker euro and U.S. Treasury bond prices.
The foreign reserves dipped to $1.00 trillion at the end of last month from a record $1.02 trillion in March, the ministry said. At that level, Japan`s foreign reserves remained the second largest in the world next to China, whose holdings reached $1.68 trillion at the end of March
In another economic release Japan`s index of leading indicators logged 20.0 in March, far below the boom-or-bust threshold of 50. The index was 54.5 in February and 45.5 in January. The coincident index, which measures the current state of the economy, came in at 33.3 in March, also matching forecasts by the economists. It was 70.0 in February and 20.0 in January.
In Hong Kong, the Hang Seng Index fell 1.5% to 25,063.17 and the Hang Seng China Enterprises Index lost 1.6% to 13,662.58.
China`s Shanghai Composite dropped 1.2% to 3,613.49, after rising as high as 3,693.16 earlier in the day. On the economic side the producer price index (PPI) for China`s industrial products rose 8.1% in April over April 2007, putting on more pressure on the inflation rate. The factory-gate prices of raw materials, fuel and power were up 11.8%.
Meanwhile China`s imports in April totaled US $101.92 billion, with exports at US$ 118.58 billion. Based on these indicators, the trade surplus was around US$ 16.7 billion in April.
Australia`s S&P/ASX 200 index rose 0.9% to 5,771.80. On the economic front the Reserve Bank of Australia increased its inflation forecasts for this year, noting underlying CPI is to remain above its target band until late 2010 at the earliest, dampening expectations interest rates could fall from their current 12-year high of 7.25% any time soon.
The central bank forecast growth in the headline CPI will raise to 4.25% by June and peak at 4.5% in December, eventually falling back to 2.75% by the end of 2010, the central bank said in its quarterly monetary statement.
The central bank said there are major risks its estimates could be off the mark in either direction owing to contrasting forces that are likely to affect the economy in the period ahead.
Elsewhere, Taiwan`s weighted index gave up 0.8% to 8,792.39. South Korea`s Kospi fell 1.3% to 1,823.70, while New Zealand`s NZX 50 index added 0.7% to 3,601.17.
In the afternoon trading India`s Sensitive Index, or Sensex, dropped by 1.3% to 16,855.37 and the broader S&P/CNX Nifty rose 1.3% to 5,016.35. Singapore`s Straits Times Index dropped 0.4% to 3,160.50. On the economic front India`s wholesale price index rose 7.61% in the 12 months to April 26, marginally higher than previous week`s annual rise of 7.57%.
It was the highest since an annual reading of 7.68 per cent on Nov. 13, 2004. The annual inflation rate was 6.01 per cent during the corresponding week of the previous year.
June crude-oil futures jumped as much as 61 cents to $124.30 a barrel in electronic trading, after finishing 16 cents higher at $123.69 a barrel Thursday on the New York Mercantile Exchange.
In currency trading, the U.S. dollar bought 103.60 yen in Asia, compared with 103.88 yen late Thursday in New York.
European shares declined in the morning trade, with financials under pressure after American International Group unveiled plans to raise more capital after a steep quarterly loss and as Citigroup may unveil a plan to sell $400 billion worth of assets.
Of national indexes, the U.K. FTSE 100 index declined 0.5% to 6,238.90 and the German DAX 30 index lost 0.7% to 7,024.01. The French CAC-40 index put in an even worse performance, down 1.4% to 4,985.80.
In Germany wholesale prices in April rose 0.6 %from March and increased 6.9 pct from a year earlier. Germany`s wholesale price index stood at 122.9 in April compared with 122.2 in March and 115.0 in April 2007. The year-on-year change in March was 7.1% higher and in February, it was higher by 6.0%.
In France the industrial output for March was down a seasonally adjusted 0.8 %month-on-month, following a 0.5 %rise in February. Manufacturing output, which excludes food and energy, was down 1.5% in March. Food output was down 0.6 % in March, while for consumer goods it fell 0.8 %. Automobile output fell 2.9% and capital goods production was down 1.1%. Intermediate goods fell 1.7%, while energy output was up 2.4%.