Asia markets suffer more losses, Tokyo up

HONG KONG: Most Asia markets sank again yesterday at the end of a painful week for global equities defined by an oil rout that analysts warn could continue for some time.

Crude prices extended losses and have now tanked more than 10% since last Friday when the Opec grouping decided against capping output despite an oversupply and anaemic global demand.

Dealers are also keeping tabs on next week’s Federal Reserve policy meeting, where it is expected to hike interest rates for the first time in nine years.

“It’s difficult for shares to move much ahead of the Federal Reserve meeting,” Hitoshi Asaoka, a senior strategist at Mizuho Trust & Banking Co in Tokyo told Bloomberg News.

“Oil prices haven’t stabilised yet so we can easily enter a wait-and-see mood. I expect the market to continue to be unstable.”

The Opec decision last week has sent oil to around seven year lows, and with the global economy struggling, China’s growth subdued and the dollar tipped to strengthen further, the commodity is expected to remain beaten down until possibly 2017.

Prices were hurt further by Opec’s announcement Thursday that its collective production rose in November to its highest level in three and a half years and beyond its 30 million ceiling target.

The figures are “reinforcing consternation that the global oil market is going to remain oversupplied for a longer time”, said Bernard Aw, market strategist at IG Markets in Singapore.

Shares in Hong Kong sank 1.1% -- a seventh-successive loss -with CNOOC and PetroChina leading energy firms lower.

But troubled mining giant Glencore surged more than 11% in late trade after saying in London it would accelerate a plan to reduce debt and slash its 2016 capital budget to $3.8 billion from $5 billion previously. London-listed shares in the firm ended up 7.7%. On other markets Shanghai slipped 0.9%, Sydney was 0.2% lower and Seoul sank 0.2%.

In Shanghai, trading in Chinese conglomerate and Club Med owner Fosun International was suspended yesterday as reports swirled that its billionaire chairman had become unreachable and could be under investigation.

Guo Guangchang, dubbed “China’s Warren Buffett”, had been out of contact since Thursday, respected business magazine Caixin reported.

It cited social media postings as saying police took Guo away at an airport in Shanghai, but it was not clear whether he was put under investigation himself or assisting an inquiry.