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Asian stocks fall on poor US earnings

Oct 19 2012 07:44 AFP

A man checks the figures on an electronic stock board of a securities firm in Tokyo, Japan. (Koji Sasahara, AP) (Koji Sasahara)

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Bangkok - Most Asian stock markets fell on Friday following disappointing US corporate earnings and uncertain progress from a European summit convened to hash out solutions to the region's debt crisis.

European Union leaders opened a two-day meeting in Brussels on Thursday and took a critical step by agreeing to create a banking supervisor to oversee institutions in the 17 countries using the euro.

But analysts at Credit Agricole CIB in Hong Kong said negotiations are expected to be difficult during the summit's second day after reports emerged "about potential legal issues" concerning the draft proposal for the banking supervisor.

Japan's Nikkei 225 index fell 0.1% to 8,970.56. South Korea's Kospi lost 0.9% to 1,942.47 and Australia's S&P/ASX 200 fell 0.1% to 4,554.50. Hong Kong's Hang Seng bucked the trend, rising 0.1% to 21,545.65.

An unexpected jump in weekly US jobless claims also hurt investor sentiment. The US Labour Department reported Thursday that weekly applications for US unemployment benefits jumped 46,000 last week to a seasonally adjusted 388 00, the highest in four months after falling sharply the previous week.

Worse-than-expected US earnings were another negative for Asian markets.

Microsoft said net income fell a worse-than-expected 22% to $4.47bn in the fiscal first quarter, which ended September 30. Microsoft shares fell in after-hours trading.

Shares of internet search trailblazer Google were pummeled after third quarter earnings were released three hours too early by mistake. The results alarmed investors because the company's earnings and revenue fell well below analyst projections.

Google's stock price dropped 8%, causing $20bn in shareholder wealth to evaporate.

BB&T bank, Philip Morris International and Boston Scientific all fell after reporting results that fell short of forecasts.

The Dow Jones industrial average fell less than 0.1% to 13,548.94. The Standard & Poor's 500 index fell 0.2% to 1,457.34. The Nasdaq composite index slid 1% to 3,072.87.

Benchmark oil for November delivery was down 4 cents to $92.06 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 2 cents to finish at $92.10 a barrel on Thursday.

In currencies, the euro rose to $1.3070 from $1.3061 late Thursday in New York. The dollar rose to ¥79.33 from ¥79.23.

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