Emerging-Market Stocks Swing Between Gains, Losses; Acer Slumps, Kia Gains

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  • Posted on April 25, 2011

    Emerging-market stocks swung between gains and losses. Technology shares fell after Acer Inc. (2353)’s profit missed analysts’ estimates, while South Korean automakers advanced after Yonhap News reported Kia Motors Corp. (000270) sold a record number of vehicles in the first quarter.

    The MSCI Emerging Markets Index was little changed at 1,206.03 as of 2:44 p.m. in Singapore. The measure swung between gains and losses at least 20 times. China’s Shanghai Composite Index lost 1.4 percent as higher oil prices fanned concern inflation will accelerate and spur further monetary tightening. Russia’s Micex Index advanced 0.5 percent and South Korean’s Kospi Index (KOSPI) increased 0.8 percent.

    “There’s lighter volume due to Easter,” said Gavin Parry, managing director of Parry International Trading Ltd. in Hong Kong. “Interest rate uncertainty in Asia, Singapore’s inflation and a weak U.S. dollar equal higher imported inflation for Asia and stronger currencies.”

    Singapore’s inflation held at 5 percent in March as housing and transportation costs surged, supporting the central bank’s decision this month to allow further currency appreciation. Asian central banks from China to Thailand and India are raising interest rates or allowing their currencies to gain to curb price pressures as oil and food costs rise.

    Acer lost 3.1 percent in Taipei after first-quarter net income tumbled 64 percent to NT$1.2 billion ($41 million), lower than the NT$1.74 billion average among nine analyst estimates, according to data compiled by Bloomberg. Information technology shares were the biggest drag on the MSCI index. Kia Motors rose 2.6 percent in Seoul. The company sold a record 565,355 vehicles in the first quarter, a 20.2 percent increase from a year earlier, Yonhap News reported, citing a company investor relations document.

    Syria, Oil

    Crude futures gained as much as 0.4 percent to the highest since April 11 on concern Middle East unrest will disrupt supplies. Syrian security forces detained at least 200 people following the killing of anti-government protesters and U.S. Senator John McCain said rebels in Libya need more assistance in the fight against Muammar Qaddafi’s forces.

    The MSCI Emerging Markets Index has advanced 18 percent in the past 12 months on speculation earnings growth will withstand monetary policy tightening among developing nations. Companies in the index are valued at an average 11.3 times estimated earnings.

    Among other technology shares, Coretronic Corp. (5371) fell 2.5 percent in Taipei after first-quarter net income slumped 39 percent to NT$593 million.

    Mando Corp. (060980), a maker of automotive parts, surged 9.7 percent in Seoul after Kayaba Industry Co. said the two companies will start a venture in Brazil to make shock absorbers. Hyundai Engineering Plastics Co., a maker of polypropylene compounds to produce automobile parts, jumped 15 percent.

    South Korean automakers also gained on speculation they will win sales lost by Japanese rivals. Japan’s Mazda Motor Corp. said domestic production fell by 54 percent in March after a record earthquake and tsunami disrupted supply chains.

    OAO Gazprom, the world’s biggest gas producer, advanced 0.7 percent in Moscow.

    To contact the reporter on this story: Weiyi Lim in Singapore at wlim26@bloomberg.net

    To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net


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