Asian stocks closed lower on Friday after the price of oil breached US$60 a barrel, hammering Wall Street and prompting a round of selling across the Asia-Pacific.
However, dealers said regional losses were modest, after oil prices broke a fresh record high, with markets falling short of the steep 1.57 percent slump felt in New York overnight.
During the day most Asian investors were sidelined with one eye on Wall Street and the other on oil which eased slightly in Asia but by early European trade crude was again nearing US$60 per barrel.
Even if oil remains at current levels, dealers said any substantial losses here could be avoided if New York is spared a prolonged downturn.
Most markets restricted their losses to less than 0.50 percent, although New Zealand was the worst performer after dropping 1.13 percent.
Only China and India managed to buck the trend with property stocks propelling limited gains in Hong Kong while petrochemicals aided the Shanghai bourse. India rose as monsoon rains spread across the country.
Taiwanese share prices are expected to continue firmer next week on the back of strong foreign investor support with a chance that the key 6,400 points resistance level could be breached, dealers said on Friday.
Despite the latest spike in oil prices and a bad bout of nerves on Wall Street as a result, the market held up well on Friday and should be able to regain momentum next week provided nothing untoward happens in the US.
Taipei holds ground
In Taipei share prices closed 0.52 percent lower, hit by heavy overnight losses on Wall Street after oil breached US$60 per barrel.
Dealers said that despite the negative New York lead, the market held up reasonably well, with investors confident that there are further gains to come on the back of sustained foreign investor support.
It remains possible for the market to regain momentum early next week, so long as Wall Street is spared a prolonged downtrend and oil prices remain below US$60 a barrel, said Oliver Fang of Yuanta Core Pacific Securities (元大京華證券).
The TAIEX closed down 33.17 points at 6,340.69 on turnover of NT$69.54 billion (US$2.22 billion) on Friday.
For the week to June 24, the TAIEX gained 47.13 points or 0.75 percent, following a 1.63 percent gain the previous week.
Average daily turnover stood at NT$81.40 billion, down from NT$87.37 billion dollars a week earlier.
Tokyo share prices closed 0.34 percent lower on concerns about global economic growth after crude oil prices hit a record high.
"The high oil prices are certainly capping stock prices," said Hideo Mizutani, chief strategist at Sieg Securities.
But Mizutani added that share prices are still managing to remain above the 11,500 level as Japan's economic outlook is positive and investors are taking a wait-and-see stance on how much further the spike in crude oil will go.
The NIKKEI-225 index fell 39.72 points to 11,537.03.
In Seoul share prices closed 0.83 percent lower on heavy program selling with high oil prices causing a drop in blue chips.
Dealers said the market fell through 1,000 points but managed to recover some of the early losses, backed by increased retail investor interest in second-liners.
"The market was dealt a heavy blow after oil touched the critical 60 US dollar level. Oil prices are really a big threat to the market as well as the economy," Goodmorning Shinhan Securities analyst Kim Hak-Gyun said.
RSS