Greek uncertainty dampens Asian trading ANZ Bank reports strong growth from Asia

Asian shares were lower in late afternoon trading despite positive offshore leads. Tokyo was closed for trading due to a public holiday. The MSCI Asia Pacific excluding Japan Index slid 1.9% and Standard & Poor’s 500 Index futures fell 1.3%.

Greece dominated headlines with the absence of any large significant regional economic news. One worth pointing out was a Chinese purchasing managers’ index, which fell to 57.7 from 59.3 in September, the China Federation of Logistics and Purchasing said on its website today.

Corporate news was also quiet with the exception of ANZ which reported in Australia this morning, as discussed in our earlier note. After taking a closer look at the result, our view remains unchanged. The key takeaway for us is the Asian growth strategy starting to deliver strong results. Asia Pacific Europe & America (APEA) underlying profit was 20% higher in US$ terms despite more challenging market conditions. ANZ’s return on equity of 16% is a lot higher than other Asian peers and the stock will continue to find favour with a wide regional investor base.

In Korea, LG Electronics was asked by the Korea Exchange to address rumours that the company might seek to sell new shares to raise capital. The request came as LG shares continued falling. The world’s third-largest mobile-phone maker has lost money for six straight quarters from handset sales. LG shares fell by as much as 11% in trading today, the largest fall since October 2008.

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