July 6, 2012 10:59 am

Samsung slips after sales miss forecasts

Samsung Galaxy S III©Bloomberg

Asian stocks remained under pressure as Samsung Electronics reported sales that missed analysts’ expectations and investors took the view that more monetary stimulus only highlight concerns about the global economy.

The FTSE Asia Pacific index slipped 0.5 per cent to 229.00, Japan’s Nikkei 225 Average eased 0.7 per cent to 9,020.75 and South Korea’s Kospi composite index fell 0.9 per cent to 1,858.20.

Samsung, the world’s largest maker of televisions and mobile phones and which accounts for 16 per cent of the Kospi, fell 2.0 per cent to Won1.16m after reporting sales that were less than analysts had predicted as investors speculated that the company’s earnings growth may have peaked.

Elsewhere in Asia growth-sensitive resources stocks were among the region’s worst performers. BHP Billiton lost 1.0 per cent to A$32.09 and Rio Tinto fell 1.5 per cent to A$57.80 in Sydney while energy company Santos shed 2.4 per cent to A$10.69.

In Tokyo, exporters led declines with Canon off 2.5 per cent at Y3120, Fujitsu falling 3.1 per cent to Y370 and Mazda Motor falling 1.9 per cent to Y104.

Australia’s S&P/ASX 200 index lost 0.3 per cent to 4,157.81, Hong Kong’s Hang Seng index was flat at 19,800.64 while China’s Shanghai Composite index gained 1.00 per cent to 2,223.58.

Banking stocks in Hong Kong and Shanghai were hit by concerns about the slowing economy and that an interest-rate cut would erode net interest margins. They were counterbalanced by gains for property developers on the prospect of lower rates driving housing demand.

China Construction Bank fell 2.7 per cent to HK$5.16 and Agricultural Bank of China lost 2.5 per cent to HK$3.11 while the Shanghai Property sub-index jumped 3.5 per cent to 3,512.13.

Investor focus is pinned on US jobs data due later on Friday as investors ponder whether the Federal Reserve will also ease policy.

On Thursday, weekly initial jobless claims fell by the most in two months and the ADP report of private sector employment rose by a stronger-than-expected 176,000 in June.

These two reports perhaps bode well for the official jobless claims numbers due on Friday. And if there is evidence that the US labour market is not as weak as many believe then this may reduce the need for the Fed to take further bold action to support demand.

Central banks in Europe and China attempted to revive the sluggish global economy on Thursday by easing monetary policy and cutting interest rates.

An interest-rate cut by the People’s Bank of China, which lowered its main one-year lending rate by 31 basis points to 6 per cent, failed to outweigh disappointment over the European Central Bank’s latest move to address the region’s debt crisis and slowing economy.

While some investors welcomed the moves, they noted the actions also signalled policy makers are becoming increasingly concerned about the health of the global economy.

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