Japan steel stocks dip

GLOBAL MARKETS

Asian stocks dropped after the Bank of Japan's Tankan survey of business confidence showed a worsening outlook among steelmakers and as India's central bank unexpectedly lifted borrowing costs.

The Morgan Stanley Capital International Asia-Pacific Index slipped 0.9 per cent to 143.41 as of 7:36 pm in Tokyo. Japan's Nikkei 225 lost 1.5 per cent to 17,028.41 and the broader Topix declined 1.8 per cent, the most since March 14. Benchmarks elsewhere in the region rose, except in India, Hong Kong, Malaysia and Australia.

Nippon Steel, the world's No 2 maker of the metal, slid 4.5 per cent to 791 yen, its biggest drop since March 5. JFE Holdings, Japan's second-largest steelmaker, tumbled 5.2 per cent to 6,610 yen. Sumitomo Metal Industries, the nation's third largest, lost 3.1 per cent to 590 yen.

Steelmakers' drop to 31 from 46 was the largest points decline among all of the industry groups included in the Tankan. The survey showed manufacturer confidence fell to 23 points in March from a two-year high of 25 in December. Woolworths, Australia's biggest retailer, dropped 2.2 per cent to A$26.60. Westpac, its fourth-biggest bank, slid 1.7 per cent to A$25.90.

US

US stock and index futures gained as a flurry of mergers and acquisitions suggested stocks are cheap relative to earnings.

Standard & Poor's 500 Index futures expiring in June gained 1.6 to 1432.80 as of 9:07 am in New York. Dow Jones Industrial Average futures rose 5 to 12,445. Nasdaq-100 Index futures gained 3.5 to 1794.25.

Escalating trade tensions between the US and China pushed the S&P 500 lower on the last trading day of March, limiting the benchmark's third straight quarterly advance. The S&P 500 rose 0.2 per cent in the quarter and the Dow posted its first quarterly loss since 2005.

Europe

European stocks rose, led by telephone-service providers after Telecom Italia's holding company received offers.The Dow Jones Stoxx 600 Index added 0.3 per cent to 375.15 at 1:48 pm in London. The Stoxx 50 also gained 0.2 per cent as did the Euro Stoxx 50, a measure for the 13 nations sharing the euro. National benchmarks advanced in 12 of the 18 markets in western Europe. The UK's FTSE 100 rose 0.2 per cent, and Germany's DAX gained 0.4 per cent. France's CAC 40 was little changed.

Telecom Italia jumped 11 per cent to 2.37 euros after AT&T and America Movil each offered to buy a third of the holding company that controls Italy's largest phone operator.

The bid values the underlying shares in Telecom Italia at 2.82 euros each, 32 per cent more than the previous closing price.

Pirelli & C, Telecom Italia's largest indirect shareholder through Olimpia, surged 11 per cent to 92 euro cents.

France Telecom, Europe's second-largest phone company, climbed 2.2 per cent to 20.21 euros. Deutsche Telekom, the region's biggest phone company, rallied 2.7 per cent to 12.71 euros.