Most emerging-market stocks fell as
gains in Chinese home prices boosted concern the government will
delay easing monetary policy.
Soho China Ltd. (410), a property developer, slumped 2.8 percent
after data showed the nation’s new-home prices rose in the
largest number of cities in 14 months in July. HTC Corp. (2498), Asia’s
second-largest smartphone maker, lost 4.2 percent after saying
it will post a $40 million loss from an investment in an online
gaming systems company. Tingyi (Cayman Islands) Holding Corp. (322), a
noodle maker, surged 6 percent in Hong Kong after first-half
profit beat estimates.
Eleven stocks declined for every eight that rose in the
MSCI Emerging Markets Index, which fell less than 0.1 percent to
970.66 as of 2:37 p.m. in Hong Kong, set for the lowest close
since Aug. 8. The People’s Bank of China has no plan to cut
lenders’ reserve-requirement ratios in the short term, the
central bank’s Financial News said in a commentary. Thailand cut
its economic growth forecast today, while data may show Taiwan’s
export orders dropped in July.
The Chinese data “shows how very complicated it is to
stimulate the growth while simultaneously damping speculation in
the property market,” John Woods, the Hong Kong-based chief
Asian strategist at Citigroup Inc.’s private bank, said in a
Bloomberg Television interview. “The last thing they want to
see is to unleash the animal spirits yet again in the property
sector.”
The Hang Seng China Enterprises Index of mainland companies
listed in Hong Kong dropped 0.6 percent. The Shanghai Composite
Index (SHCOMP) slipped 0.3 percent, heading toward the lowest close since
July 31. Taiwan’s Taiex Index lost 0.5 percent. Markets in
India, Indonesia, Malaysia and the Philippines are closed for
holidays.
Lower Valuation
The MSCI Emerging Markets Index has gained 5.9 percent this
year, compared with a 9.2 percent increase in the MSCI World
Index of developed nations. The developing-nations measure
trades at 10.8 times estimated earnings, compared with 13.1 for
the MSCI World, data compiled by Bloomberg show.
Soho China was headed for the lowest close since June 7,
while Shui On Land Ltd. (272) slid 1.3 percent. Chinese new-home
prices climbed in July from a month earlier in 49 of the 70
cities tracked by the government, the National Bureau of
Statistics said on its website on Aug. 18. That was the most
since May last year.
“A rebound in property prices is bad for the economy as
the government will refrain from conducting further policy
easing,” said Li Jun, a strategist at Central China Securities
Co. in Shanghai. “Investor sentiment is bad and the market will
test new lows,” Li said, referring to Chinese equities.
Taiwanese Exports
Yuan forwards traded today at this year’s biggest discount
to the Chinese currency’s onshore spot rate on concern the
economic slowdown will worsen, while options traders are
charging the biggest premium since March to protect against
losses in Chinese companies. The AlphaShares Chinese Volatility
Index, derived from options on companies listed in Hong Kong,
traded at a premium of as much as 41 percent over the Chicago
Board Options Exchange Volatility Index last week.
Thailand’s gross domestic product is forecast to expand 5.5
percent to 6 percent, compared with a previous growth range of
5.5 percent to 6.5 percent, Arkhom Termpittayapaisith,
secretary-general of the National Economic and Social
Development Board, said in Bangkok. Data today may show Taiwan’s
export orders dropped 2.98 percent in July after falling 2.62
percent in June, according to the median estimate of economists
in a Bloomberg survey.
HTC, Hotai
HTC dropped the most in almost two weeks after saying it
will recognize a $40 million loss from OnLive, a U.S.-based
provider of online gaming systems in which the Taiwanese company
invested last year. Hotai Motor Co. (2207), a Taiwanese car dealer,
sank 4.5 percent, the biggest decline in the MSCI Emerging
Markets Index (MXEF), after the island’s state-owned oil refiner raised
gasoline prices.
Samsung Electronics Co. (005930) sank 0.9 percent in Seoul to a two-
week low. The stock was the biggest drag on the MSCI Emerging
Markets Index after the company and Apple Inc. reported they
made no progress in narrowing a patents dispute.
LG Innotek Co. (011070) rallied 6 percent after Taurus Investment
Securities Co. said the South Korean company’s camera-module
sales will increase. Tingyi rose the most since Nov. 7 in Hong
Kong after reporting a 24 percent increase in first-half profit
that was more than expected by analysts in a Bloomberg survey.
LG Innotek and Tingyi posted the biggest gains in MSCI’s
emerging-markets index.
To contact the reporter on this story:
Saeromi Shin in Seoul at
sshin15@bloomberg.net
To contact the editor responsible for this story:
Darren Boey at
dboey@bloomberg.net
Most Emerging Stocks Fall Amid China Policy Concern; HTC Slumps
Kiyoshi Ota/Bloomberg
HTC dropped the most in almost two weeks after saying it will recognize a $40 million loss from OnLive, a U.S.-based provider of online gaming systems in which the Taiwanese company invested last year.
HTC dropped the most in almost two weeks after saying it will recognize a $40 million loss from OnLive, a U.S.-based provider of online gaming systems in which the Taiwanese company invested last year. Photographer: Kiyoshi Ota/Bloomberg
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