ADR REPORT: Shares Tumble On US Downgrade, Economic Fears
August 08 2011 - 5:00PM
Dow Jones News
International companies trading in New York closed plunged
Monday as a U.S. sovereign debt downgrade further sapped confidence
in the global economy.
The Bank of New York index of ADRs fell 7.3% to 117.77.
Investors fled from risk in the first trading session since
Standard & Poor's Ratings Services downgraded the U.S. to
double-A-plus from triple-A late Friday. Meanwhile, worries about
the global economy loomed large. Investors were underwhelmed by the
European Central Bank's move to buy Italian and Spanish bonds.
European banks were among the biggest decliners.
Royal Bank of Scotland Group PLC (RBS, RBS.LN) fell 16% to $8.30
as stock-investment downgrades by some analysts also weighed on the
shares after the company reported a large first-half loss Friday.
ING Groep NV (ING, INGA.AE) tumbled 14% to $8.21. Societe Generale
SA (SCGLY, GLE.FR) fell 17% to $6.73, while Barclays PLC (BCS,
BARC.LN) retreated 13% to $10.84.
The European index fell 7.4% to 107.63.
The Asian index dropped 6.6% to 118.53.
JA Solar Holdings Co. (JASO) said it expects its second-quarter
gross margin to be lower than expected on falling selling prices
and the impact of high-cost inventory provisions. Its
second-quarter earnings call is scheduled for Aug. 18. Shares slid
17% to $3.35. Peers ReneSola Ltd. (SOL) traded 18% lower to $2.76
while China Sunergy Co. (CSUN) dropped 16% to $1.12.
The Latin American index 9% to 323.77.
Chilean flagship carrier LAN Airlines SA (LFL, LAN.SN) again
lowered its estimate for passenger traffic growth as international
fuel prices and ash from a volcano in southern Chile grounded many
of its flights, daily newspaper El Mercurio reported. Shares fell
11% to $21.76.
Petrobas Petroleo Brasileiro (PBR, PETR4.BR) fell 10% to $26.15.
The CEO of the state-run company also known as Petrobras said the
impact it will feel from S&P's downgrade of the U.S. is hard to
discern.
The emerging markets index dropped 8% to 275.37.
TV panel maker LG Display's (LPL, 034220.SE) shares plunged 14%
to $9.54 amid a broad selloff of South Korean companies' shares
that MiraeAsset Securities Analyst Lee Jin-woo attributed to "panic
mode" sentiment. KG Financial Group Inc. (KB, 105560.SE) dropped
12% to $38.72. Korea Electric Power Corp. (KEP, 015760.SE)
retreated 10% to $9.85.
-By Matt Jarzemsky, Dow Jones Newswires; 212-416-2240;
matthew.jarzemsky@dowjones.com
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