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Asia stocks fall on downbeat earnings; Nikkei drops 1.17%

Published 04/26/2011, 02:48 AM
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Investing.com – Asian stock markets were broadly lower on Tuesday, as a flurry of disappointing earnings dampened market sentiment, while Japanese automakers declined after Standard & Poor’s cut its outlook on the sector.

During late Asian trade, Hong Kong's Hang Seng Index fell 1.2%, South Korea's Kospi Composite shed 0.45%, while Japan’s Nikkei 225 Index dropped 1.17%. 

Nintendo, the world’s largest maker of video-game consoles tumbled 3.3% to close at the lowest level since July 2006 after it reported a 66% drop in 2010 net income. The company also cut its earnings outlook for the current year to JPY110 billion, short of market expectations of JPY132 billion.

Shares in Japan’s fifth largest electronics company Nidec slumped 1.9% after it lowered its full-year earnings forecast to JPY52.5 billion, compared to expectations for earnings of JPY74 billion. The company said in a statement that last month’s disaster disrupted supply chains at many of its customers, making it difficult to forecast earnings.   
  
Meanwhile, the world’s largest automaker Toyota saw shares slide 2.45% after ratings agency S&P cut its outlook for Japan’s auto sector to ‘negative’ from ‘stable’, citing weaker operating and financial performance in the year ending March 2012 because of production cuts. Shares in rival Honda dropped 1.6%, while Nissan edged 0.25% lower.

Elsewhere, China Life, the country’s largest insurer fell 3.05% in Hong Kong after it said first-quarter net profit slumped 22% to CNY7.97 billion from a year earlier as payouts increased after policies matured. 

Meanwhile, China Mengniu Dairy Company, the nation’s biggest liquid-milk producer, plunged 4.45% after students in China became ill after drinking its products.

The outlook for European equity markets, meanwhile, was downbeat. The EURO STOXX 50 futures pointed to a loss of 0.4%, France’s CAC 40 futures indicated a drop of 0.27%, the FTSE 100 futures pointed to a decline of 0.28%, while Germany's DAX futures slumped 0.3%.

Later in the day, the U.S. was to publish reports on house price inflation and consumer confidence, as well as official data on manufacturing activity in Richmond.


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