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Worries About Weaker US Economy Drives Asian Stocks Down - 2002-08-02


Asian stock markets traded lower Friday on worries about how a weaker U.S. economy could affect the region's many exporters.

Worrying economic reports from the United States set the tone across Asia this week.

Most Asian markets shifted lower on a number of U.S. economic reports. Among them: consumer confidence in July took its largest fall in nine months, manufacturing slowed more than forecast, and second-quarter gross domestic product grew less than economists expected. U.S. construction fell in June, while last week's unemployment claims rose.

South Korea was Asia's worst performer Friday. The Kospi index fell one-percent to 700. Earlier in the day, it fell to a low for the year before recovering slightly. The market was pressured by selling of Samsung Electronics, South Korea's largest exporter.

In Japan, the Nikkei 225 index fell less than one-percent to close at 9,709. One stock to watch: Matsushita Electric. It closed up slightly Friday, after reporting earlier in the week that its quarterly earnings were better than forecast.

Managing Director Tetsuya Kawakami says the second half of the fiscal year will be determined by overall demand from the United States and that massive restructuring measures are helping the company's performance.

Several share markets in greater China managed to escape the downtrend. Taiwan stocks rose a fraction to 4,920. Government buying helped some shares, as is often the case in Taiwan. Chipmaker Winbond Electronics was one beneficiary. It closed 1.5 percent higher.

Mainland China's exchanges in Shanghai and Shenzhen also ended the week on an up-note. They rose slightly on several newspaper reports saying the central bank and the main stock market regulator support the development of the country's capital markets.

In currency trading, the yen edged up Friday against the dollar. A Bloomberg news survey of currency analysts finds that the yen is expected to strengthen again on the dollar this month. The greenback has fallen about 9.5 percent this year against the Japanese currency, as well as against the euro. Traders say that fears about the state of the U.S. economy keep the dollar under pressure.