Asian share mostly up, Japan airlines hit by Boeing woe

PHOTO: Asian share mostly up, Japan airlines hit by Boeing woe

HONG KONG - Asian markets mostly rose Thursday, with a weaker yen lifting Tokyo following the previous day's losses but Japan's top two airlines fell after grounding their Boeing 787 Dreamliners on safety fears.

News that US authorities had also ordered airlines to stop flying the troubled Boeing airplanes added to selling pressure on Japan Airlines and All Nippon Airways and supplier firms after a string of incidents.

Tokyo rose 0.18 per cent, Hong Kong added 0.49 per cent, Sydney was 0.74 per cent higher and Seoul put on 0.10 per cent but Shanghai eased 0.19 per cent.

Investors resumed selling the yen after the currency jumped on Wednesday in reaction to comments from Japan's economy minister that if it fell to rapidly consumers would be hit as imported goods would become more expensive.

The rise in the euro and dollar provided a fillip to Tokyo's Nikkei, which slumped on Wednesday following the warning from Akira Amari and on profit-taking after the index hit a 32-month high earlier in the week.

In early trade the dollar bought 88.67 yen, up from 88.37 yen in New York late Wednesday, while the euro rose to 118.07 yen from 117.42 yen.

The single currency was also at US$1.3313, from US$1.3286.

Eyes are now on a Bank of Japan rate-setting meeting due next week to see if it follows a monetary policy line closer to the new government, which is calling for more loosening.

However, shares in Japan Airlines and All Nippon Airways fell as they grounded all their Dreamliners after ANA had to make made an emergency landing Wednesday, in the latest in a string of incidents to hit the plane, including engine problems and fuel leaks.

The move took half the world's 787 fleet out of service and hours later US regulators ordered US airlines to ground the aircraft until a fire risk linked to its lithium batteries had been resolved.

Japanese authorities said Thursday the grounding would continue until all batteries were confirmed to be safe.

In morning trade ANA was 1.6 per cent lower and JAL slipped 1.0 per cent.

The move also hit component suppliers in Japan, with carbon fibre maker Toray Industries tumbling 3.5 per cent and battery maker GS Yuasa falling 7.5 per cent.

Wall Street provided an anaemic lead, with the Dow falling 0.17 per cent, the S&P 500 flat and the Nasdaq up 0.22 per cent.

Dealers also have an eye on Friday's release of Chinese growth data, with expectations high that it will show a further pick-up in the economy as it emerges from a drawn-out slumber.

Oil prices were lower, with New York's main contract, light sweet crude for delivery in February shedding six cents to US$94.18 a barrel while Brent North Sea crude for March delivery fell 94 cents to US$109.67. Gold was at US$1,679.60 at 0250 GMT compared with US$1,678.80 late Wednesday.