Shares of most Asian major petchem firms slump on US, China concerns

27 January 2014 04:29  [Source: ICIS news]

SINGAPORE (ICIS)--Shares of most major Asian petrochemical companies slumped on Monday, tracking losses in regional bourses, ahead of a key US Federal Reserve policy meeting this week that will likely see another round of stimulus tapering in the world’s biggest economy.

Signs of continued weakness in the Chinese economy are also weighing on the Asian equities markets.

At 11:17 Singapore time (03:17 GMT), Japan’s Mitsubishi Chemical was 3.42% lower, Mitsui Chemicals was down by 1.53% and Asahi Kasei was down by 2.85%, as the benchmark Nikkei 225 index fell 2.49% to 15,009.04.

Japan reported a 65.3% year-on-year increase in its trade deficit to a record yen (Y) 11,474bn ($112bn) in 2013 as costs of energy imports surged with the depreciation of the yen.

In South Korea, LG Chemical was down by 2.61% and Lotte Chemical declined 3.80%, with the Korea Stock Exchange KOSPI Index falling by 1.45% to 1,912.41.

In Hong Kong, PetroChina was 1.65% lower, while Sinopec fell by 1.43% in the morning session, with the benchmark Hang Seng Index slipping by 2.08% to 21,983.69.

Malaysian producer PETRONAS Chemicals Group slipped by 0.90%, while Thailand’s PTT Global Chemical was down by 1.01%.

In the Thai capital of Bangkok, anti-government protests marred by violence are continuing ahead of the 2 February polls. A protest leader – Suthin Tharathin – was shot on Sunday while delivering a speech, while nine other people were injured.

Last week, the key Japanese Nikkei 225 index fell by 2.2%, South Korea’s Kospi index was down by 0.2% and Hong Kong’s Hang Seng index fell nearly 3%.

Regional investors, however, will likely focus on the outcome of the Federal Open Market Committee (FOMC) meeting that will be concluded on Wednesday, according to Singapore-based UOB Economic-Treasury Research.

The Fed is expected to announce a further $10bn reduction in its bond-buying programme to $65bn in February, it said.

Investors are also eyeing the first estimate of the US’ fourth-quarter 2013 GDP that is due for release on Thursday.

By: Nurluqman Suratman

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