Asian exporters fell yesterday, led by Toyota Motor Corp and Samsung Electronics Co, on concern US demand may ebb after a survey showed consumer confidence in the world's biggest economy slid.

　　Japanese drugmakers rose after Yamanouchi Pharmaceutical Co agreed to buy Fujisawa Pharmaceutical Co to form the nation's second-largest drugmaker, sparking speculation more companies will have to combine to compete with larger foreign rivals.

　　The Morgan Stanley Capital International Asia-Pacific Index shed 0.2 percent to 88.87 at 4:51pm yesterday in Tokyo. Toyota and Samsung Electronics were the biggest drags on the index, while Yamanouchi and Fujisawa were among the top five gainers.

　　"It's a jobless recovery in the US and without an improvement in the employment situation and spending, it's going to be tough for exporters," said Taiji Yoshida, who helps manage US$7.6 billion at Yasuda Asset Management Co in Tokyo. "The only way for Japan's drugmakers to survive globally is through more mergers and acquisitions."

　　Japan's Topix Index fell 0.2 percent to 1046.40. Benchmark indexes advanced in Taiwan, South Korea, Australia and New Zealand, while all others declined.

　　Taiwan's TWSE Index advanced 0.8 percent, and was the region's best performer. Liquid-crystal display makers including AU Optronics Corp gained after DisplaySearch said the island will overtake South Korea this year as the world's largest supplier of LCDs.

　　Thailand's SET Index slid 1.5 percent. Banpu Pcl, the country's biggest coal miner, dropped after the state utility canceled plans to sell a stake in the country's second-biggest power producer to Banpu.

　　South Korea's SK Telecom Co rose after SK Group owner Chey Tae-won, convicted in South Korea's worst accounting scandal this decade, quit the nation's biggest cell phone company following shareholder criticism of the founding family's influence.

　　Toyota, the world's largest automaker by market value, shed 1.9 percent to 3,630 yen (US$33.45). The company derives about 82 percent of its operating profit from North America. Honda Motor Co, which sells the Pilot and MDX sport-utility vehicles in the US, lost 2.6 percent to 4,580 yen.

　　Samsung Electronics, South Korea's largest exporter, sank 1.1 percent to 525,000 won (US$448.66). It has dropped 6.8 percent since setting a record on February 16.

　　Hong Kong's Li & Fung Ltd, which buys Asian-made clothing for US clients including Abercrombie & Fitch Co, lost 2.3 percent to 14.65 Hong Kong dollars (US$1.88).

　　The New York-based Conference Board's sentiment index for February dropped to 87.3, the lowest since October, from a revised 96.4 last month. The decline was the biggest since a 14-point decrease in February 2003, a month before the start of fighting in Iraq.

　　Yamanouchi and Fujisawa said they needed to merge to fend off overseas competition in Japan, the world's second-largest drug market. The purchase values Fujisawa at 2,549 yen per share, 2 percent higher than Tuesday's closing price of 2,495 yen.

　　Fujisawa rose 5.2 percent to 2,625 yen. Yamanouchi gained 3.9 percent to 3,730 yen.

　　The acquisition may trigger takeovers among drugmakers because they've held failed merger talks in the past, Philip Hall, an analyst at Credit Suisse First Boston, said.

　　"Yamanouchi's move is creating interest among investors about who might be next," said Yasuda Asset's Yoshida.

　　AU Optronics, Taiwan's largest maker of LCDs, rose 4.8 percent to NT$54.50 (US$1.64). Chi Mei Optoelectronics Corp, the island's second-largest maker of flat-panel displays used in computers and televisions, climbed 5.3 percent to NT$49.50.

　　Taiwanese companies will ship 42 percent of the world's LCDs this year compared with about 41 percent for South Korea, according to DisplaySearch, a research company.

　　"LCD manufacturing is poised to become the island's fastest growing industry, fueling growth for Taiwan's technology sector," said Phil Chen, a fund manager at Taipei-based Grand Cathay Securities Investment Trust Co, which manages US$1.9 billion in assets.

　　(Bloomberg News)