Hyundai Heavy Industries Co., the world's largest shipbuilder, dropped the most in three weeks, pacing South Korean yards after BNP Paribas SA said orders will slow amid a global credit crunch and economic slowdown.
Hyundai Heavy fell as much as 8.5 percent to 231,500 won and traded at 232,500 won as of 12:12 p.m. in Seoul trading. Samsung Heavy Industries Co., the second-biggest yard, dropped as much as 8 percent to 27,100 won.
Asian stocks tumbled for a third day after the global credit crisis deepened in Europe and the U.S. lost the most jobs in five years. The liquidity crunch is making it difficult for shipowners to borrow money and slowing economic growth is undermining trade.
In the face of tighter market liquidity, increased trepidation toward further global economic slowdown and orders books of longer than three years, we forecast Korean orders will shrink by 19 percent next year amid another 25 percent drop in global orders,'' BNP's James Yoon said in the Oct. 6 report. BNP cut the rating on the industry to neutral'' from overweight.''
New orders worldwide in September were 7 million deadweight tons, 66 percent less than a year earlier, analysts Park Sang Kyoo and Lee Hyun Jae at Morgan Stanley said in an Oct. 6 report. Ship prices are also starting to soften, they said.
STX Shipbuilding Co., the owner of Europe's biggest shipyard, dropped as much as 9.3 percent to 19,000 won. Hyundai Mipo Dockyard Co., a unit of Hyundai Heavy, fell as much as 9.1 percent to 145,000 won.
Shipbuilders are also falling on concerns that they will report bigger hedging losses as the Korean won dropped to the lowest since 2002 today. Shipbuilders expected the won to rise this year and bought forward currency contracts to hedge against their dollar-denominated orders.
The weaker won will mean bottom line at the shipyards may be smaller than expected this year because of the losses from hedging,'' Lee Bong Jin, an analyst at Eugene Investment & Securities Co., said in Seoul.
Daewoo Shipbuilding & Marine Engineering Co., the world's third-biggest, slipped as much as 12 percent to 23,050 won, the lowest in 20 months on concerns a sale of a controlling stake may be postponed amid the stock markets decline.
Korea Development Bank and Korea Asset Management Corp., who are selling their 50.4 percent stake, may cancel the sale should bidders submit prices below expectations on Oct. 13, Korea Economic Daily said today, citing an unidentified Korea Development Bank official.
Hyundai Heavy fell as much as 8.5 percent to 231,500 won and traded at 232,500 won as of 12:12 p.m. in Seoul trading. Samsung Heavy Industries Co., the second-biggest yard, dropped as much as 8 percent to 27,100 won.
Asian stocks tumbled for a third day after the global credit crisis deepened in Europe and the U.S. lost the most jobs in five years. The liquidity crunch is making it difficult for shipowners to borrow money and slowing economic growth is undermining trade.
In the face of tighter market liquidity, increased trepidation toward further global economic slowdown and orders books of longer than three years, we forecast Korean orders will shrink by 19 percent next year amid another 25 percent drop in global orders,'' BNP's James Yoon said in the Oct. 6 report. BNP cut the rating on the industry to neutral'' from overweight.''
New orders worldwide in September were 7 million deadweight tons, 66 percent less than a year earlier, analysts Park Sang Kyoo and Lee Hyun Jae at Morgan Stanley said in an Oct. 6 report. Ship prices are also starting to soften, they said.
STX Shipbuilding Co., the owner of Europe's biggest shipyard, dropped as much as 9.3 percent to 19,000 won. Hyundai Mipo Dockyard Co., a unit of Hyundai Heavy, fell as much as 9.1 percent to 145,000 won.
Shipbuilders are also falling on concerns that they will report bigger hedging losses as the Korean won dropped to the lowest since 2002 today. Shipbuilders expected the won to rise this year and bought forward currency contracts to hedge against their dollar-denominated orders.
The weaker won will mean bottom line at the shipyards may be smaller than expected this year because of the losses from hedging,'' Lee Bong Jin, an analyst at Eugene Investment & Securities Co., said in Seoul.
Daewoo Shipbuilding & Marine Engineering Co., the world's third-biggest, slipped as much as 12 percent to 23,050 won, the lowest in 20 months on concerns a sale of a controlling stake may be postponed amid the stock markets decline.
Korea Development Bank and Korea Asset Management Corp., who are selling their 50.4 percent stake, may cancel the sale should bidders submit prices below expectations on Oct. 13, Korea Economic Daily said today, citing an unidentified Korea Development Bank official.