Japan, Korea lead Asia ADR declines
Japan, Korea lead Asia ADR declines
U.S.-listed shares of Asian companies fell hard Wednesday, led by losses among Japanese and Korean names.
The Bank of New York Asia American Depositary Receipt Index fell 1.10 points to 137.32, suffering the biggest drop among the sub-regional indexes. The overall Composite ADR Index traded 0.84 points lower to 140.68. Earlier, Japan’s Nikkei 225 dropped 250 points, ending 1.56 lower.
Japan’s largest bank by market capitalization said a steep decline in costs associated with writing off bad loans boosted its profit. It also increased its profit and dividend guidance for the full year ending in March, The Wall Street Journal reported.
Japanese ADRs fell broadly on fears that the government’s long standing policy of zero percent interest rates could soon come to an end, said Wayne Yu, Asia-Pacific trader at Jefferies & Co.
“This is a pattern we’ve been expecting since the end of the year. Any slightly negative comment…could be a trigger for profit taking given that we had such tremendous gains last year,” he said.
The Nikkei 225 Index soared nearly 40% in 2005 but some money managers are now urging investors to cash out of big gains seen in the last several months.
More: marketwatch.com