Brakes go on at Toyota Motor

ASIA'S stocks took a drubbing today, including carmaker Toyota Motor, which was singled out for a critical analysis in influential investors' magazine Barron's.

It questioned whether there was much further upside for the fast rising stock, which is listed in New York and Tokyo. Spurred in part by a successful sales push into the US, Toyota recently nudged Ford Motor out of the world's numbertwo carmakers' slot.

'There is no argument that Toyota remains a powerhouse,' Barron's said. 'Yet while Toyota shares might still be a long-term buy, investors might consider taking profits now.'

Some market players seemed to take that as their cue, clipping Toyota by 60 yen or 1.8% to 3300 yen, although almost every share was on the slide amid poor sentiment.

Barron's cautioned that the outlook for Toyota into next year remained hard to fathom. 'Regardless of whether it (Toyota) outsells beleaguered Ford in all of 2003 - and there are reasons for suspecting it might not - there's little doubt that further profit gains are likely in 2004,' it said.

Barron's can pack quite a punch. An article this year that ran the slide rule over Sony, the consumer electronics maker, proved at the time to be powerful pick-up. It said Sony shares could double in a couple of years, sparking a nifty rally.

The wider market was awash with red ink. Japanese brokers cited renewed jitters about banks' bad loans, lingering fears about terrorism, and Wall Street's backward step last Friday.

They also pointed to a market seen in need of consolidation after months of gains, fuelled in part by foreign cash. The Nikkei 225 tumbled 380.23 points or more than 3.6% to 9,786.83.

Lenders were in the firing line after the Financial Services Regulator last week carried out a health check on banks' ongoing efforts to clamp down on bad loans. It revealed that potential loanloss charges were still rising - not falling as many investors had hoped. Mizuho Financial dived 19,000 yen or 7.2% to 221,000 yen, UFJ fell 22,000 yen or 5.4% to 383,000 yen and Sumitomo Mitsui Financial traded at 470,000 yen, lower by 26,000 yen or 5.2%.

Techs wilted after disappointing earnings from peers in the US at the end of last week. Advantest, which makes equipment that tests chips, plunged 470 yen or 5.9% to 7560 yen and NEC shed 50 yen or 5.7% to 834 yen.

Hong Kong stocks were in similarly poor shape amid the revived terror fears. Brokers said they saw waves of profit-taking, sending the Hang Seng index down 197.04 points or 1.6% to 12,006.49.

Banks, developers and exporters all took a hit. Bank of East Asia eased 65 cents or 2.7% to HK$23.10, Henderson Land Development gave up 60 cents or 1.9% to HK$31.50, and Li & Fung fell 30 cents or 2.2% to HK$32.20.

Singapore shares retreated in line with the region, despite a modest upward revision in growth data for the just-completed quarter.

The Straits Times index gave up 25.11 points or 1.5% to 1711.61. Banks were punished by profittakers with Statelinked DBS Group tumbling 40 cents or 2.7% to S$14.70.