Asian stocks closed narrowly mixed on Friday, with investors remaining uncertain about the outlook for inflation and US interest rates in the wake of Hurricane Katrina, although Tokyo bucked the trend with sharp gains, dealers said.
They said caution was the key word, with few willing to take any aggressive positions ahead of the weekend amid conflicting views about whether the US Federal Result will pause or press ahead with its policy of measured interest rate hikes.
How oil prices and increasing inflation pressure develop will provide a real test of sentiment, given the sustained regional run-up, which has seen several markets at record levels.
PHOTO: AP
On the day, Tokyo rose 1.26 percent to fresh four-year highs as investor confidence continued to improve and the market was reassured by polls showing Japanese Prime Minister Junichiro Koizumi set to win today's general elections with ease.
Seoul added 0.63 percent and Mumbai managed a marginal few points to allow both to extend their record-breaking performance while Jakarta put on 1.67 percent.
Taiwanese share prices closed 0.50 percent lower, with sentiment undermined by the Wall Street's losses and a further depreciation in the New Taiwan dollar, dealers said.
They said that the continued weakness in the local currency has raised concerns foreign investors may be taking funds out of the country, with their stance a key indicator for their local peers and the market as a whole.
The weighted index closed down 30.82 points at 6,119.06, off a high of 6,167.90 and a low of 6,108.40, on turnover of NT$57.24 billion (US$1.75 billion). Declines led gainers 634 to 278, with 126 stocks unchanged.
"Investors were preparing for short-term plays as they expect the market to extend its consolidation," said Samson Chueh, an assistant vice president at Fuhwa Securities.
"They were reluctant to build position because the bourse is looking to define a bottom," he said.
Lingering concerns over Taiwan's economic prospects and the impact of Hurricane Katrina kept investors to the sidelines in the absence of any major fresh news to the market, Chueh added.
Japanese share prices rose 1.26 percent to another four-year high on record trading volumes, riding a wave of optimism about Japan's economy two days ahead of a general election, dealers said.
Relatively upbeat earning outlooks from key US chipmakers Intel and Texas Instruments sparked a rally in Japanese technology shares.
Investors were able to set aside jitters over this weekend's general election in Japan, with polls showing the market-friendly Koizumi's party enjoying a comfortable lead over rivals.
The Tokyo Stock Exchange's benchmark NIKKEI-225 index gained 158.15 points to 12,692.04 as an unprecedented 3.04 billion shares changed hands.
The broader TOPIX index of all first-section shares rose 14.45 points or 1.13 percent to 1,293.35.
A rush of recent data showing Japan's economic recovery remains on track has seen Tokyo shares rise to a series of four-year bests in recent weeks, with optimism towards the tech sector providing the latest fillip.
South Korean share prices chalked up another record finish, adding 0.63 percent led by financial and telecom stocks as investors shrugged off Wall Street's weaker close and a central bank warning of a possible rate hike, dealers said.
They said the market appeared to benefit from institutional investor support, with fresh funds coming in in search of an alternative investment after recent government measures to cool an overheated property sector.
The KOSPI index closed up 7.24 points at a record 1,152.50.
Hong Kong share prices closed flat as the outlook for US inflation and interest rate movements remained unclear in the wake of the devastation caused by Hurricane Katrina, dealers said.
The Hang Seng Index closed down 0.40 points at 15,165.77.
Chinese share prices closed 0.40 percent lower on profit-taking with airlines and real estate developers under pressure after recent gains as oil prices eased off record highs, dealers said.
They said investors took quick profit on the gains made this week led by falling oil prices and expectations of more fund inflows.
The Shanghai A-share Index shed 5.00 points to 1,250.16, while the Shenzhen A-share Index was down 2.52 points or 0.83 percent at 299.71. The benchmark Shanghai Composite Index, which covers both A- and B-shares, closed down 4.79 points or 0.40 percent at 1,189.63.
Australian share prices closed 0.15 percent lower as investors took profits on resource and energy stocks while Wall Street losses added to the negative sentiment, dealers said.
The key S&P/ASX 200 index was down 6.8 points at 4,468.1, having fallen as much as 32.2 points earlier on heavy selling of market heavyweights BHP Billiton and Rio Tinto. The broader All Ordinaries was 7.1 points lower at 4,432.7.
Singapore shares closed 0.15 percent higher on gains in local technology stocks after an upbeat report from US semiconductor giant Intel Corp., dealers said.
The Straits Times Index (STI) added 3.38 points at 2,301.28. Gains led losers by 270 to 177, with 614 stocks unchanged.
Malaysian shares prices closed 0.12 percent higher in cautious trade, with investors continuing concerned by the possible impact of high oil prices on the economy, dealers said.
The Kuala Lumpur Composite Index gained 1.12 points to 917.92.
Thai share prices closed 0.32 percent lower on profit taking in the banking sector, dealers said.
The Stock Exchange of Thailand (SET) composite shed 2.30 points at 712.78 points and the bluechip SET 50 index dropped 2.27 points to 505.52.
Indonesian share prices closed 1.67 percent higher, led by blue chips Astra International and Telkom as a more stable rupiah and easing oil prices bolstered investor confidence, dealers said. The Jakarta Stock Exchange composite index added 18.006 points at 1,098.456.
Philippine share prices closed 1.21 percent lower as investors opted for safety ahead of the weekend in the face of continued political uncertainty and after a weak Wall Street performance coupled with a fresh rise in oil prices, dealers said.
The composite index fell 23.07 points to 1,882.77 points after trading between 1,882.60 and 1,910.80.
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