(RTTNews) - The stock markets in the Asia-Pacific region extended losses from the previous session and are trading sharply lower on Thursday, tracking the overnight losses on Wall Street where weak U.S. housing data triggered concerns over the health of a global economic recovery and the outlook for demand of commodities.

U.S. stocks moved sharply lower over the course of the trading day on Wednesday on concerns about the outlook for the economy. The day’s pessimism was primarily driven by the Commerce Department’s report on new home sales in the month of September, which showed that new home sales unexpectedly decreased compared to the previous month.

Some selling pressure was also generated by news that Goldman Sachs lowered its forecast for third quarter U.S. GDP growth to 2.7% from 3.0%. The third quarter GDP report is due to be released before the start of trading in the U.S. stock markets on Thursday.

The major averages all closed well below the unchanged line, backing further off of their yearly highs. The Dow fell by 119.48 points or 1.2 percent to 9,762.69, the Nasdaq dropped by 56.48 points or 2.7 percent to 2,059.61 and the S&P 500 declined by 20.78 points or 2 percent to 1,042.63.

Oil prices turned sharply lower again on Wednesday as the dollar continued its comeback bid versus the euro. Front month crude for December slipped US$2.09 to US$77.43 a barrel on the New York Mercantile Exchange, pushing further away from its yearly high of US$82 set last week.

The Australian stock market is trading lower by more than 2% on Thursday, led by resource stocks and banks. In mid-day trades, the benchmark S&P/ASX 200 Index is losing 96.70 points or 2.06% to 4,588.40 and the broader All Ordinaries Index is down 100.40 points or 2.14% to 4,586.90.

The Australian market closed firmly lower on Wednesday, led by weakness in the financial sector. The S&P/ASX200 index closed lower by 68.4 points or 1.4 percent at 4,685.1 while the All Ordinaries index declined 67.6 points or 1.4% to settle at 4,687.3.

On the economic front, new home sales in Australia declined in number by 4.5% in September compared to August, according to survey results released Thursday by the Housing Industry Association, or HIA. The report said the number of sales of stand-alone houses fell 4.3% for the month, but were up 4.0% for the three months to September.

Meanwhile, the Conference Board reported that it’s leading economic index for the country increased 1.8% in August. The board’s Coincident Index, which measures current economic activity, fell 0.2% in August. The board also said it upwardly revised the index for recent months, as new data became available.

In the currency market, the Australian dollar was trading lower at noon as concerns about a recovery in the global economy weakened equities markets and commodity driven currencies. n mid-day trades, the Australian dollar was trading in a range of US$0.8966-US$0.8969, down from Wednesday’s close of US$0.9106-US$0.9110. Since early morning, the local unit has moved between US$0.8945 and US$0.9012.

In the banking sector, ANZ Bank and Commonwealth Bank are currently down 1.9% each, while National Bank is losing 2.15% and Westpac is declining 1.99%. Diversified financial services provider Macquarie Group is down 2.16%.

ANZ Bank reported an 11% decline in net profit for the year ended September 30 to A$2.943 billion from A$3.32 billion in the prior year and said the Australian market is close to a peak in the bad debt cycle.

Among miners, BHP Billiton is down 3% and Rio Tinto is trading lower by 4.4%. Gold miner Lihir Gold is down 2.6%, Newcrest is losing 3% and Sino Gold is down a sharp 4.4%.

Lihir Gold says it is on track to meet full year production guidance after meeting quarterly production targets and boosting reserves by 36% at Lihir Island operation. Meanwhile, Newcrest Mining said the outlook for gold remains positive, although production is expected to continue to decline in the foreseeable future.

In the oil space, Oil Search is unchanged, while Origin Energy is down 0.8%, Santos is declining 2.6% and Woodside Petroleum is losing 2.4%. Australia’s largest electricity retailer AGL Energy is down 0.5%. The company said it is aiming for a rise in underlying profit of up to 10.8% in 2009/10.

The Japanese stock market was trading lower, with the benchmark Nikkei 225 index dropping below the 10,000 mark for the first time in three weeks. A stronger yen and the sharp overnight losses on Wall Street contributed to the weakness.

In late morning trades, the Nikkei 225 Index is losing 195.68 points or 1.94% to 9879.37 after touching 9,850.12, its lowest intraday level since October 8. The broader Topix index of all First Section issues on the Tokyo Stock Exchange was down 9.59 points, or 1.08%, to 879.21.

The Japanese market closed lower on Wednesday. The Nikkei 225 index declined 137.41 points or 1.35% to 10,075.05 and the Topix index dropped 6.68 points or 0.8% to 888.80.

Among a raft of economic news, the Ministry of Economy, Trade and Industry said Thursday that industrial output in Japan was up 1.4% on month in September, climbing for the seventh consecutive month. The reading came in above expectations for a 1.0% increase following the 1.6% gain in August.

Meanwhile, the Bank of Japan said that an index measuring corporate service prices in Japan was down 3.2% on year in September, posting a score of 98.0. That was marginally better than forecasts for a 3.4% annual decline after a 3.5% fall on year in August. On month, corporate service prices eased 0.2%.

Japan’s Ministry of Finance reported Thursday that foreign residents bought 35.1 billion yen more in Japan stocks than they sold during the week ending October 24, their third straight week as net buyers. Foreigners sold a net 117.3 billion yen in Japan bonds and notes for the week, their third straight week as net sellers.

Meanwhile, Japan residents sold a net 51.0 billion yen or foreign-based stocks for the week, their third straight week as net sellers. They bought a net 304.9 billion yen in foreign stocks for the week, having been net sellers the previous week.

In the currency market, the U.S. dollar was trading in the lower 90 yen zone on Thursday. In late morning trades, the dollar was quoted in a range of 90.44-90.46 yen, down 0.71 yen from Wednesday’s close of 91.15-91.17 yen in Tokyo.

Among automakers, Toyota Motor Corp., which counts on the U.S. market for much of its sales, is down 0.8% following the overnight release of U.S. data showing that sales of new homes declined in September, mirroring sluggish consumer spending.

The Nikkei reported that Toyota likely posted an operating loss of 250 billion yen for the six months ended September, better than the previously estimated loss of 400 billion yen. However, investors were unmoved by the news, as it was largely in line with market projections. Meanwhile, Honda is declining 1.19%, Nissan is losing 3.5% and Suzuki is down 2%.

Banking stocks were advancing after recent declines. Mitsubishi UFJ Financial Group is gaining 3.6%, Mizuho Financial Group is adding 1.7%, Resona Holdings is surging 5% and Sumitomo Mitsui is advancing 1.3%.

NEC Electronics was ask-only in Tokyo at a limit-down level of 650 yen, after its net loss for the fiscal second quarter widened from a year ago and the company said it now expects a much wider loss for the full business year.

Tech stock Advantest fell 6.8% after the the company reported a net loss of yen 3.30 billion for the fiscal second quarter, as cost cuts and other steps failed to offset a slump in sales.

Shares of consumer credit company Takefuji Corp. rebounded sharply and are up 4.8% after the Nikkei business daily reported that the company likely saw a group net profit of 17 billion yen in the April-September half, better than the previous forecast of 8.2 billion yen.

In the oil sector, Nippon Oil is losing 3.14%, Nippon Mining Holdings is down 4.9% and Showa Shell Sekiyu KK is declining 2.27%.

Japan Airlines’ shares rebounded for the first time in three trading days and is up more than 6% after a media report that the government is discussing comprehensive legislative measures to promote the carrier’s rehabilitation.

Drug maker Astellas Pharma announced Thursday morning that a subsidiary has applied to the European Medicines Agency for approval to market the antibiotic Telavancin. The drug is for the treatment of nosocomial pneumonia, including ventilator-associated pneumonia, and complicated skin and soft tissue infections. However, shares of the company are down 2%.

Shares of Mitsubishi Heavy Industries traded lower for the third straight day, and is down 1.5%. The Nikkei reported earlier in the day that the company will begin domestic production of engines for small passenger jets as early as 2013.

The South Korean stock market extended losses from the previous session and is trading sharply lower on Thursday, led by steel and bank stocks. Foreign investors sold stocks and moved to safer assets after bleak U.S. home sales data underscored concerns about weakening economic recovery momentum.

In late morning trades, the benchmark Korea Composite Stock Price Index, or KOSPI, is trading at 1574.36, down 35.35 points or 2.20%.

The KOSPI finished sharply lower on Wednesday, due to heavy losses among the shipping companies - while the technology, steel and automobile stocks also finished firmly in the red. For the day, the index plunged 39.82 points or 2.4% to finish at 1,609.71.

In the currency market, the South Korean won was trading at 1,198.75 won to the U.S. dollar in late morning trades, down 3.35 won from Wednesday’s close of trading in Seoul.

In the tech space, market heavyweight Samsung Electronics is losing 1.53% and LG Electronics is down 3%, while Hynix Semiconductor is gaining 1.13% and LG Display LCD is unchanged.

Steel maker Hyundai Steel is down 6.2% and Posco is losing 5% after sector leader ArcelorMittal dampened recovery expectations on Wednesday with a muted forecast for the last quarter of 2009.

Hyundai Steel said Thursday that its third-quarter earnings more than doubled from a year earlier on profit from the sale of its stake in Hyundai Motor Co. and cost-cutting measures. The company’s net profit rose to 572 billion won in the July-September period, from 220 billion won a year earlier. Sales, however, dropped 37% from the year-ago period to 2.05 trillion won. The company also forecast that its fourth-quarter business performance will improve on rising demand.

In the banking sector, Korea Exchange Bank is losing 0.7%. Woori Finance, Shinhan Financial and KB Financial, the holding firm of Kookmin Bank, are trading lower in a range of 2-2.2%

Oil issue SK Holdings is down 4.1% after the company reported a 46% on-year drop in net profit for the third quarter. Meanwhile, S-Oil is losing 1.3% and energy stock KEPCO is declining 2.4%. Among telecom stocks, SK Telecom is down 1.94% and KT Corp. is losing 1.5%.

The New Zealand stock market was trading lower despite the Reserve Bank of New Zealand’s announcement that it would leave interest rates unchanged.

The Reserve Bank of New Zealand on Thursday left the country’s key interest rate unchanged, and signaled no raising of rates until the second half of next year. The central bank announced that the Official Cash Rate would remain at 2.50%.

Among other markets in the Asia-Pacific region, China’s Shanghai composite index is down 64 points or 2.10% to 2,968, Hong Kong’s Hang Seng index is losing 565 points or 2.60% to 21,196, Taiwan’s weighted index is declining 244 points or 3.23% to 7,290, Singapore’s Straits Times index is down 31 points or 1.15% to 2,618, and Indonesia’s Jakarta composite index is down 112 points or 4.74% to 2,244.

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Posted in Categories: Australia, Eurozone, Japan, New Zealand, Releases, Stocks, USA.

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