Wall Street drags Asian stocks down

Asian stocks closed lower on Friday after losses on Wall Street sparked by the crisis over Iran's nuclear program hit sentiment and raised the prospect of a sharp spike in oil prices, dealers said.

They said the losses were not significant but clearly reflected a sense of caution that if the UN were to impose sanctions on Iran, oil prices could rise sharply, contrary to current expectations they will ease as the Northern Hemisphere winter ends.

Many believe the markets, many running at record or multi-year highs, are 'priced for perfection' and so could be vulnerable to any bad news -- such as a confrontation with Iran which threatened its oil output.

Tokyo was flat after disappointing private sector machinery order figures while Seoul added 0.98 percent for another record finish as investors focused on Samsung Electronics' positive outlook rather than its weaker-than-expected fourth-quarter results.

Taiwanese share prices closed 0.64 percent lower after Wall Street's losses, with sentiment further undermined by concerns about political bickering after the legislature cut the government's proposed budget for this year, dealers said.

Heavyweight tech stocks, including semiconductor and flat panel display makers, led the falls after losses overnight in New York.

The TAIEX fell 43.26 points at 6,682.35, off a high of 6,729.58 and a low of 6,669.64, on turnover of NT$97.24 billion (US$3.04 billion).

Declines led gains 801 to 297, with 144 stocks unchanged.

Fubon Securities Investment Services (富邦投顧) manager Daniel Tseng (曾建詮) said the market sustained a moderate pull-back largely in step with Wall Street after recent gains.

"A note of caution has gradually crept in, as shown in the recent contraction in turnover, even though some are still betting on a further advance driven by ample liquidity in the run-up to the Lunar New Year" at the end of the month, Tseng said.

He said the market stands a good chance of regaining momentum but the upside could be limited given gains of more than 1,000 points over the past couple of months.

Japanese share prices closed little changed as the market took a breather following losses on Wall Street and weaker-than-expected domestic machinery orders data, dealers said.

The Tokyo Stock Exchange's benchmark NIKKEI-225 index gained 9.76 points or 0.06 percent to 16,454.95, the highest close since Sept. 20, 2000.

The broader TOPIX index of all first-section shares shed 2.65 points or 0.16 percent to 1,681.69.

Decliners outnumbered gainers 858 to 714, with 97 stocks unchanged.

Seoul

South Korean share prices closed 0.98 percent higher for a fresh record, reversing early losses as investors quickly digested Samsung Electronics' downbeat results and cheered its positive outlook, dealers said.

The market opened under pressure from Wall Street's overnight losses and concerns over the outlook for oil prices as tensions over Iran's nuclear program increase but stocks later rebounded on institutional investor support.

The KOSPI index closed up 13.7 points at the day's highest level of 1,416.28, off a low of 1,388.15.

Samsung Electronics closed up 10,000 won (US$10.19) at 694,000 won as Hynix rose 400 won to 38,100 won.

Hong Kong share prices closed 0.44 percent higher, extending gains as investors bought into blue chips and China stocks after some caution in the morning session, dealers said.

The Hang Seng Index closed up 68.60 points at 15,787.97, off a low of 15,670.77 and high of 15,792.36. The index has gained 911 points or 6.1 percent so far this year.

Shanghai share prices closed 0.42 percent lower on profit-taking, with the main index coming off nine-month highs as oil refiners and real estate stocks fell, dealers said.

They said the losses were relatively modest after recent sustained gains, which bodes well for a market which has chronically underperformed over the years and may mean that it could go higher after a consolidation period.

However, any momentum may be interrupted by the upcoming Lunar New Year holiday at the end of the month and if corporate results are hit by problems of overcapacity in the Chinese economy.

The Shanghai A-share Index lost 5.43 points to 1,283.09, while the Shenzhen A-share Index was down 0.29 points or 0.09 percent at 309.15.

The benchmark Shanghai Composite Index, which covers both A- and B-shares, shed 5.25 points or 0.43 percent at 1,221.46.

Australian shares closed little changed again around record levels but managed to come off early lows following Wall Street's overnight downturn, dealers said.

They said the market drifted in and out of positive territory toward the finish, finding no direction as investors waited for US economic data to give them their next lead on the outlook for US interest rates.

The key S&P/ASX 200 index slipped 0.2 points to 4,836.7, but the broader All Ordinaries edged up 2.6 points for another record close of 4,784.3, beating the previous all-time high of 4,781.7 set on Thursday.

"We saw some selling early in the day particularly on some of the big mining stocks but most traders were willing to sit on their positions and look for further upside," CMC Markets' senior dealer James Foulsham said.

Singapore

Singapore share prices closed flat, with investors reluctant to trade after a weaker Wall Street overnight, dealers said.

They said there was some profit-taking in select blue chips.

The Straits Times Index slipped 1.52 points or 0.063 percent to 2,405.86. Losers beat gainers 277 to 259 with 615 shares unchanged.

Despite the lackluster day, dealers remained optimistic about the market, predicting the index will firm up after the current correction phase.

Malaysian share prices closed flat, finding no lead after Wall Street's fall overnight pushed the region as a whole lower, dealers said.

The Kuala Lumpur Composite Index was up 0.74 points at 911.90.

Losers led gains 502 to 258, with 268 stocks unchanged and 294 untraded.

Thai share prices closed 0.36 percent higher as investors took heart from a fresh report the prime minister's family may be ready to sell its holdings in technology and communications giant Shin Corp., dealers said.

The Stock Exchange of Thailand (SET) composite index rose 2.68 points to 755.72 and the blue-chip SET 50 index edged up 0.39 points to 531.12.

Indonesian share prices closed 0.46 percent lower on extended profit-taking in blue chips Telkom and Bank Mandiri, dealers said.

The Jakarta Stock Exchange composite index fell 5.825 points at 1,250.428.

Philippine share prices closed 0.48 percent lower as investors took profits following losses overnight on Wall Street, dealers said.

The composite index fell 10.38 points to 2,148.27 after trading between 2,142.26 and 2,159.12.

New Zealand share prices closed 0.55 percent lower after losses in offshore markets, dealers said.

The benchmark NZSX-50 gross index fell 18.67 points to 3,364.74.

Indian share prices closed easier, steadying after sustained losses in the past few sessions as the market came of record highs hit last week, dealers said.

The 30-share SENSEX index was down 6.69 points at 9,374.19.