Profit-takers take toll on Canon

WITH holidays looming, a softer Wall Street and several key corporate earnings announcements to come, profit-taking was the theme of Asian share trading.

Japan's Canon, the office equipment maker, was one of the principal casualties, receding 130 yen or 2.3% to 5480. Brokers said that after its dramatic surge since March, the stock was ripe for consolidation.

Canon shares bottomed out towards the end of the first quarter at 3910 yen. Then, fuelled by hopes for stronger sales in a recovering US economy and a cost-cutting drive that has trimmed headcount, the stock has flourished. It peaked earlier this month at 6120 yen. Investors' enthusiasm was driven by six-month earnings of 130bn yen (£686m), underpinned by savings put at 30bn yen.

Banking giant Mizuho Financial was also clipped back. The world's biggest lender by assets fell 5600 yen to 96,400, off by 5.5%. Smaller peer UFJ dropped by 4000 yen or 1.8% to 218,000.

Consumer electronics player Sony softened ahead of what will be crucial results for the quarter to June, due on Thursday. The numbers are the first major insight into how the company is faring since its fourth-quarter figures, released in April, shocked investors and triggered a deep slump in Sony shares. Observers said profitability at the key electronics division was then the main concern. The stock has recovered its April losses amid rekindled hopes for a revival.

Rival Matsushita Electric Industrial fell 14 yen or 1% to 1341, while the Nikkei 225 benchmark index eased 1% to 9435.11, before going on to close at 9485.97, down 41.76 points.

It was a similar tale in Singapore as traders saw few, if any, reasons for strong buying.

State-linked lender DBS Group, which helped pull the market up on Monday, dropped 40 cents or 3.3% to S$11.50. Family-controlled rival UOB, which reached a recent peak of S$13.90 as a recovery play, gave up 20 cents or 1.5% to profit-takers to S$13.20. The Straits Times index shed 20.3 points to 1550.5.

Trade was listless in Hong Kong. In line with the regional retreat and weaker Wall Street, HSBC, the global bank, shed 50 cents or 0.5% to HK$94.25, while tycoon Li Ka-shing's conglomerate Hutchison Whampoa slipped 75 cents or 1.5% to HK$50.50. The 33-member Hang Seng index fell 111.7 points to 9991.2.

Taiwan bucked the trend, eking out limited gains after three days of losses. The Taiwan Weighted index advanced 2.57 points to 5221.87, brokers seeing buying in select tech shares. Bellwether contract chip-maker Taiwan Semiconductor Manufacturing was, like Sony, under the spotlight ahead of quarterly results due on Thursday. It traded level at T$57. Memory chip-maker Nanya Technologies was one of the strongest performers on talk of rising prices for its products. It gained 40 cents or 1.5% to T$26.60.

In Australia the bears maintained the upper hand as the All Ordinaries index fell 22.10 points to 3048.50 amid a lack of positive leads.