Monday, October 10, 2005














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Stock markets seen choppy on corporate results, US concerns

          MUMBAI, Oct 09 (AFP): Indian stock markets were expected to trade choppy next week as investors react to the release of quarterly corporate results and on concerns of a possible slowdown in the US economy, dealers said Friday.
"A lot of volatility is expected next week due to these two reasons," said Hemen Kapadia, partner at investment advisory firm Morpheus Inc.
The volatility was already evident Friday with the Mumbai stock exchange's 30-share Sensex index closing down 0.44 per cent at 8,491.56 after ranging from a high of 8,586.43 and a low of 8,410.69.
Dealers said share prices will react sharply to the quarterly earnings of technology companies starting with blue chip Infosys, which kicks off the season on October 11.
Software companies such as Infosys, Tata Consultancy and Wipro are expected to post at least 12 to 15 per cent sequential growth in net profits for the three months to September.
"There will be an effect on the share prices and trading will be choppy," said a fund manager with a leading domestic brokerage.
KARACHI: Pakistani stocks are likely to remain dull next week as investors concentrate on fasting during the Muslim holy month of Ramadan, dealers said Friday.
Stock markets close an hour earlier than usual during Ramadan but energy stocks rallied a few times despite sluggish trading, they said.
"There is a historical trend that in the first two weeks of Ramadan, investors step out of the market to proceed to Umrah (pilgrimage to Mecca) and observe fasting," said chief analyst at Capital One Equities Humaira Zaheer.
Buyers are expected to go for some stocks, especially in the energy sector, for dividend gains as book-closing is due later this month, she said.
For the week ended October 7, the benchmark Karachi Stock Exchange index of 100 shares rose by 316.74 points or 3.85 per cent to close at 8542.40 points.
KUALA LUMPUR: Malaysian share prices are expected to trade sideways next week in the absence of fresh leads after a cautious federal budget, although plantation stocks are expected to be strong, dealers said.
The 2006 federal budget released on September 30 had been strongly anticipated, but its conservative focus on reducing business costs, rather than introducing new tax incentives, left market players cold.
"With the budget offering few sustainable leads, market participants are once again scouring for other leads, which are proving to be difficult to come by," said Victor Wan, a senior analyst at Mercury Securities.
SINGAPORE: Singapore shares are expected to trade on a firmer note next week on hopes that economic growth in the third quarter will remain strong, dealers said.
The government is due Monday to release preliminary figures for the September quarter and analysts are hopeful of a strong display following signs of strength in the key manufacturing sector.
The forward-looking Purchasing Managers' Index (PMI), which measures activity in the manufacturing sector, rose 0.9 points to 53.1 in September from the previous month.
For the electronics industry, the PMI rose 2.5 points to a 15-month high of 55.6 points.
TOKYO: Japanese stocks face further turbulence next week with a rush of US earning releases set to determine whether a recent correction spurred by inflation worries has run its course, analysts said.
The Tokyo market endured a rollercoaster ride this week, reaching new four-year highs before sliding in tandem with US markets as inflation warnings from US central bankers set the scene for further interest rate rises there.
October is traditionally a weak month for stock markets, associated with the 1929 Wall Street crash and other market routs such as 1987's "Black Monday".
US shares tend to fluctuate in October because of the company results and the coming two weeks would bring a tough environment for Wall Street, said Toshio Sumitani, senior strategist at Tokai Tokyo Research Center.
"Japanese shares will be tracking US stocks next week," he said.
Next week also sees the Bank of Japan's policy board gather for a two-day meeting with a decision due Wednesday.
On the data calendar, machinery orders for August will be published Tuesday.
But analysts say that the impact of Japanese indicators would be limited.
"US factors such as quarterly US corporate results will be key," said Ryuta Otsuka, strategist at Toyo Securities.
Leading US companies including Apple Computer and Advanced Micro Devices, will announce quarterly earning results next week.


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