Asian stocks fell, dragging a regional benchmark to its worst weekly performance in almost three months, amid mounting credit-market losses at financial companies and a plunge in the US dollar.
Westpac Banking corp slipped after Citigroup Inc and Morgan Stanley reported mortgage-related losses. Mizuho Financial Group Inc, Japan's second-largest publicly traded bank, slumped after the Nikkei newspaper said a merger of one of the bank's brokerages and Shinko Securities Co will be delayed by subprime-related losses.
"The uncertainty in subprime and further writeoffs in the US banking system would certainly put pressure on stocks here," said Hans Goetti, who oversees US$10 billion as Singapore-based chief investment officer at LGT Bank in Liechtenstein AG.
Nintendo Co, which generated more than a third of its sales from the Americas in the last financial year, led exporters lower on concern a weaker US dollar will erode its US income when converted back to yen.
The Morgan Stanley Capital International Asia Pacific Index lost 3.38 percent to 162.84 this week, the worst decline since the five days ended Aug. 17. All 10 industry groups retreated.
The Mumbai market was closed for a holiday.
Taiwanese share prices closed 0.37 percent higher on a technical rebound after the government apparently lent support to the market.
But dealers said gains were capped by ongoing concerns about the US economy.
"Government support must have helped underpin the market today," said Oliver Fang, assistant vice president at Yuanta Core Pacific Securities (
"Bargain hunting by small investors ... played a lesser role," he said.
Investors refrained from heavy buying after US Federal Reserve Chairman Ben Bernanke cautioned that economic growth would slow noticeably in coming months.
The TAIEX closed up 33.34 points or 0.37 percent at 8,970.92 on turnover of NT$154.44 billion (US$4.8 billion).
The big decline in margin lending positions on Thursday meant many investors were scared enough to cash out of the market, Fang said, adding chances of the index reaching 10,000 points in the near future is increasingly remote.
There was reason to believe that government funds bought into market heavyweights such as Taiwan Semiconductor Manufacturing Co (台積電) to lend support to the market and boost the Democratic Progressive Party's chances in next year's parliamentary and presidential elections, he said.
Japanese share prices fell for a sixth straight trading day, hitting the lowest level in almost three months as credit crunch fears continued to unnerve investors.
Dealers said a stronger yen also hit the share market as a firmer yen has the potential to reduce exporter earnings.
The NIKKEI-225 index fell 188.15 points to 15,583.42.
The losses capped a terrible week that saw the NIKKEI slump 5.7 percent and the TOPIX plunge 6.6 percent.
Share prices closed little changed, up 0.08 percent, after an erratic session, on worries over volatility on Wall Street and new tightening measures in China.
Dealers said property stocks helped the key index finish in positive territory after HSBC and Hang Seng Bank announced quarter point cuts in prime lending rates, making mortgages cheaper.
The Hang Seng Index closed up 23.19 points at 28,783.41.
Kenny Tang, associate director at Tung Tai Securities, said the market trimmed its gains toward the close as investors played safe ahead of the weekend.
Chinese share prices closed 0.27 percent lower after a volatile session amid heightening concerns the local economy faces risks from inflation and the global credit crunch.
The Shanghai Composite Index, covering A and B shares, fell 14.48 points to 5,315.54.
South Korean shares closed higher after erratic trading, lifted by bargain hunting in banks that had been battered by fallout from the US credit crisis.
The KOSPI index ended 10.91 points or 0.6 percent higher at 1,990.47.
Australian shares closed 0.4 percent higher Friday after a takeover bid from mining giant BHP Billiton for rival Rio Tinto supported resources stocks.
The benchmark S&P/ASX 200 closed up 24.1 points at 6,545.7 after peaking at 6,605.1.
Share prices finished 2.0 percent lower, dragged down by concerns of a slowdown in the United States economy.
The Straits Times Index dropped 73.34 points to 3,599.67.
Malaysian share prices slipped 0.8 percent after Bernanke's grim assessment of the US economy prompted a wave of profit-taking.
The composite index eased 11.60 points to 1,402.25.
Thai share prices closed marginally higher on speculative buying of big-cap energy stocks after oil prices surged once again in Asian trading.
The composite index added 1 point, or 0.11 percent, to 874.64.
Indonesian share prices closed 1.1 percent higher buoyed by gains by miners and oil producers on expectations rising commodity prices will boost earnings this year.
The composite index closed up 29.44 points at 2,707.67.
Philippine share prices closed 0.3 percent higher at the end of a volatile week amid soaring oil prices and a gloomy outlook for the US economy.
Dealers said solid gains in mining stocks offset losses in the broader market.
The composite index added 11.56 points to 3,703.66.