23 November 2011 08:29 [Source: ICIS news]
SINGAPORE (ICIS)--Shares of Asian petrochemical companies tumbled on Wednesday, in tandem with crude prices, on concerns about weakening global demand.
Fresh data out of the US and China – the world’s two biggest economies and oil consumers – indicated softening fundamentals.
At 16:02 Singapore time (08:02 GMT), the share price of South Korea’s LG Chem was down by 3.08%, Hanwha Chemical slumped 5.15% and SK Innovation declined 2.45%, while the KOSPI composite index shed 43.18 points or 2.36% at 1,783.10.
In Hong Kong, PetroChina fell 2.64% as the benchmark Hang Seng index slipped 357.58 points or 1.96% at 17,894.01.
In Thailand, PTT Global Chemicals dipped 1.56% and Siam Cement was down 0.63%, while the SET index eased 4.57 points, or 0.47% at 972.79.
Japanese markets are closed for a public holiday on Wednesday.
NYMEX crude light sweet for January delivery was at $96.88/bbl, down $1.11 from Tuesday’s close, while BRENT crude was down 84 cents to $108.19/bbl.
The prices of a number of petrochemical products have been falling for months because of softening demand. Regional producers resorted to reducing output in an attempt to stem the slide in product values.
Concerns about the possibility of another global recession just heightened, with the world’s biggest global economies showing signs of weakness and the eurozone still enmeshed in its debt crisis.
On Tuesday, the US had revised its third-quarter GDP growth to 2.0% from 2.5%, while a flash estimate by HSBC on China’s manufacturing sector in November suggested a decline in production.
HSBC had a 48 reading on China’s purchasers’ managers index (PMI). A reading below 50 indicates a contraction.
Paul Hodges studies key influencers shaping the chemical industry in Chemicals and the Economy
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