Prices Scaring Off Investors ASIA MARKETPLACE By Bloomberg
By Michael Tsang and Chen Shiyin
Asian stocks sank further on Tuesday after Morgan Stanley recommended that investors cut holdings in Japanese and emerging- market equities. Shares of Sumitomo Mitsui Financial Group and Taiwan Semiconductor Manufacturing fell.
“Investors are concerned that shares have gotten too expensive and there’s no reason to buy into the market at these prices,” said Koji Uchida of Mitsubishi UFJ Asset Management.
The Nikkei 225 slid 16 points to 16,720.99 and the Kospi, in South Korea, lost 70 points to 1,332.28. Indexes also fell in Australia, China, Hong Kong, Malaysia, New Zealand, the Philippines and Thailand. But they rose elsewhere in Asia, with India’s main index, the Sensitive, closing above 10,000 points for the first time.
The Morgan Stanley Capital International Asia-Pacific index rose 35 points to 128.52 in Tokyo, lifted primarily by the yen’s strength against the dollar.
Financial and technology companies were among the MSCI’s worst performers. Sumitomo Mitsui fell 30,000, or 2.4 percent, to 1.28 million. Millea Holdings, Japan’s biggest nonlife insurer, lost 70,000, or 3.1 percent, to 2.17 million.
Taiwan Semiconductor, the world’s largest maker of custom computer chips, fell 1.5 Taiwanese dollars to 65 dollars.
Morgan Stanley recommended that global investors reduce Japanese equities by a third, to 10 percent of assets, and cut emerging market equities by half, to 5 percent.
Goldman Sachs, among others, cut its recommendations on Shionogi, maker of the cholesterol drug Crestor. Also falling were Astellas Pharma and Chugai Pharmaceutical, which distributes Tamiflu in Japan.
But the region’s steel makers gained after the Frankfurter Allgemeine Zeitung said the European steel maker Arcelor was considering a bid for U.S. Steel as a takeover defense against Mittal Steel, fueling speculation about further takeovers.
Nippon Steel, JFE Holdings and Sumitomo Metal Industries in Japan, and Angang New Steel of China, all rose.