23 Jan 2009

Markets fall as consumers think twice about gadgets

10:06 pm on 23 January 2009

Asian stocks fell 2% to a six-week low on Friday, weighed by poor corporate results in the technology sector. Other markets in the Asia-Pacific region also ended the week lower.

Samsung Electronics reported up its first ever quarterly loss on Friday, following stark warnings from tech giants such as Microsoft, Nokia and Sony, as consumers pull back severely on their spending on gadgets in the face of recessions in Britain, much of Europe, Japan and the United States.

The MSCI index of Asia-Pacific stocks outside Japan fell 2.2% to the lowest since 5 December.

Traders were reluctant to take any risks ahead of long Lunar New Year holidays throughout Asia next week.

Japan's Nikkei share average finished at a two-month low, down 3.8%. Shares of Sony Corp dropped 7% percent after saying on Thursday it would post a record $US2.9 billion loss.

Hong Kong's Hang Seng index was one of the relative outperformers in the region, slipping only 0.2%.

In Australia, the benchmark S&P/ASX 200 dropped 4%, dragged down by banks and mining stocks. Rapidly slowing growth in China, a big consumer of raw materials, has been devastating for commodity producers.

The S&P/ASX200 index lost 144.1 points, or 4.13%, to 3,3342.7 - its lowest close since February 2004 when the index finished at 3,333.7.

The broader All Ordinaries index fell 131.6 points, or 3.83%, to 3,300.3 - its lowest close since January 2004 when the index closed at 3283.6.

The price of gold in Sydney was $US858.15 per fine ounce, up $US5.25 on Thursday's close of $US852.90.

In New Zealand, the benchmark index fell 29 points, or 1%, to close at 27 05 on market turnover of $66 million.

Top stocks were mixed, with Telecom up 3 cents at $2.54, Contact Energy down 10c to $6.66 and Fletcher Building falling 20c to $5.55.

US crude futures for March delivery were down 70 cents to $US42.97 a barrel.