AMP slides after takeover hopes fade

AMP, the troubled

There was a stir in August when National Australia Bank snapped up a direct 2.3% stake in AMP in addition to the 3% already held by some of its fund management units. The swoop sparked talk of a possible takeover bid.

In recent sessions, AMP shares have lost some of their gains amid traders' fears that the bid speculation is just that, speculation. They declined 10 cents or 1.6% on Wednesday to A$6.10.

There have been straws in the wind that NAB's apparent ardour may be cooling, although some suggest the banking group may be talking down its interest to take the heat out of AMP's price before making a move.

First NAB's combined stake in AMP has been trimmed back below the 5% threshold as some of its fund managers offloaded shares.

Second, NAB chief executive Frank Cicutto said late last week that he remained concerned about AMP's exposure to Britain even after a demerger. 'It is unclear what potential financial, regulatory and reputational risks and other obligations AMP may face as a result of its continuing exposure to the UK,' Cicutto said.

Third, there was little comment on AMP this week when NAB showcased its recent figures.

Together these signals have started market talk that AMP is looking 'wobbly'. Further losses may come in forthcoming sessions, although it would be unwise to discount NAB's possible longterm intentions.

The wider Australian market ended largely unchanged despite Wall Street losses overnight. The All Ordinaries index shed 0.3 points to 3217.4.

Bank stocks, mauled in recent sessions on fears of further interest rate rises regained some composure. NAB put on 44 cents, or 1.5%, to A$29.54, Australian & New Zealand Banking Group stiffened 23 cents, or 1.4%, to A$16.51, Westpac Banking gained 22 cents, or 1.4%, to A$15.99 and Commonwealth Bank of Australia traded at A$27.55, higher by 41 cents or Banking gained 22 cents, or

1.4%, to A$15.99 and Commonwealth Bank of Australia traded at A$27.55, higher by 41 cents or 1.5%.

Media conglomerate News Corp also found favour on hopes for better revenues in the US. It advanced seven cents to A$12.70.

Nippon Telegraph and Telephone was the star in Tokyo as the world's largest phone group's revenues soared on a profit recovery and upgraded outlook. Shares in the group advanced 42,000 yen, or 9.3%, to 493,000 yen as investors priced in the news that came after Tuesday's market close. NTT raised its full-year profit forecast by nearly a third.

Banks, hit on Tuesday amid fears that the state's hefty stake in Resona, may soon be sold, recovered a tad on suspicions the downward swing had been too severe. Resona added one yen to 138 yen while Mizuho Financial rebounded 1000 yen to 243,000 yen. The Nikkei 225 edged ahead 19.8 points to 10,226.22.

Taiwan tech bellwether Taiwan Semiconductor Manufacturing found a floor after a foreign shareholder's stake sale hit the stock yesterday. It gained 0.8% to T$66.50. >But that was not enough to push the Taiwan Weighted Index into positive territory. It fell 13.4 points to 6008.68.