Asian stocks closed mostly lower on Friday after US stocks lost ground overnight in response to a jump in long-term interest rates, and a spike in crude oil prices, dealers said.
Oil prices continued higher in Asian trade as the market focused on concerns about developments in Iran and Nigeria and this continued to weigh on trade.
That coupled with the prospect of a tighter Japanese monetary policy resulted in Tokyo falling 1.55 percent.
PHOTO: AFP
Taipei was again struck by cross-strait tension and slumped 1.34 percent. Hong Kong, Manila and Sydney were also lower.
Mumbai eased off its record higher while Seoul was the worst performer on the day, tumbling almost three percent amid a possible probe into Samsung Electronics and Hynix for alleged price fixing.
Bangkok was flat in cautious trade ahead of another round of anti-government rallies as political parties gear-up for the April 2 poll. However, Singapore bucked the trend and made modest gains on China-related stocks.
Taipei share prices closed 1.34 percent lower as investors chose to lock in profits amid concerns that cross-strait relations will remain a drag on the market in the near term.
Dealers said investors were reluctant to push the upside after recent gains given concerns at the fallout from President Chen Shui-bian's (陳水扁) moves to scrap the National Unification Council (NUC).
The move sparked strong protests from Beijing.
The TAIEX lost 89.30 points to 6,553.66 on turnover of NT$99.75 billion (US$3.08 billion).
"The market came down simply because there was no justification in its going up strongly at this juncture," said Oliver Fang, a Yuanta Core Pacific Securities (元大京華證券) assistant vice president who serves mainly foreign investors.
"Don't be misled by the gains posted in the previous two sessions," he said. "Political concerns after President Chen's controversial move are far from over."
"More political noise from the opposition [in Taiwan] and Communist leaders in Beijing will be part of our life in the coming weeks," he said.
Tokyo
Tokyo share prices closed sharply lower as a jump in consumer inflation spooked investors nervous about an expected end to the Bank of Japan's ultra-loose monetary policy.
Dealers said losses on Wall Street had added to concerns over a 0.5 percent rise in Japan's core consumer prices, the fastest pace for almost eight years.
The NIKKEI-225 index lost 246.42 points or 1.55 percent to 15,663.34 as 1.73 billion shares changed hands.
The stronger-than-expected inflation data stoked speculation that the central bank could end its five-year-old policy of flooding the banking system with virtually free credit as soon as Thursday.
"Now it is certain that the end of the [super-loose] policy is coming at the March meeting [next week]," said Mitsushige Akino, a chief fund manager at Ichiyochi Investment Management.
Other analysts said a move was more likely next month after the end of the current fiscal year.
"In the mid-term, an end to the policy is not in itself bad news, as it will bring normalization to monetary policy and signal an end to prolonged deflation," Akino said.
"But in the short-term, it is likely to have a negative effect on the [stock] market given the likelihood of a stronger yen, so for the next week at least market sentiment is likely to sag," he said.
Seoul share prices closed 2.83 percent lower as Samsung Electronics and Hynix tumbled on a possible price fixing probe by regulators.
Dealers said concerns over first-quarter results for both companies had also weighed on market sentiment.
The possible probe came after the US Justice Department said four Hynix officials pleaded guilty and agreed to serve jail terms in the United States for their role in a global price fixing cartel.
NAND flash chip prices are falling on expectations of an oversupply, sparking fears that Samsung and Hynix may not meet market expectations for their quarterly results, CJ Investment Securities's Lee Min-Hee said.
The KOSPI index closed down 38.75 points at 1,328.95.
Hong Kong share prices closed 0.51 percent lower as investors turned cautious ahead of results announcements for last year from HSBC and its unit Hang Seng Bank tomorrow.
Dealers said the market was also waiting for Sun Hung Kai Properties' first-half to December results after the market close.
The Hang Seng Index fell 80.45 points to 15,802.00.
Shanghai share prices closed 0.59 percent higher, recovering some of the ground lost on Thursday in a technical rebound led by interest in the airlines and metal stocks.
Dealers said the pick up was only to be expected after Thursday's loss of some 1.60 percent and was in keeping with a consolidating market unable to break through strong resistance at 1,300 points on the Shanghai Composite Index.
The Shanghai A-share Index rose 7.91 points to 1,356.40, and the Shenzhen A-share Index was up 0.56 point or 0.17 percent at 324.22. The Shanghai Composite Index, which covers A and B-shares, added 7.63 points or 0.59 percent at 1,293.30.
Sydney shares closed 0.11 percent lower after investors took profits from resource and banking stocks.
The SP/ASX 200 index fell 5.3 points to 4,898.5 and CMC Markets senior dealer James Foulsham said overall trading was volatile on a day in which 1.19 billion shares changed hands.
Singapore
Singapore share prices defied a generally weaker regional trend and closed 0.53 percent higher, driven by gains in China-linked stocks.
However, dealers said trading was listless in the absence of fresh buying incentives, especially following recent strong gains.
The Straits Times Index rose 13.13 points to 2,493.43.
In Kuala Lumpur share prices closed 0.31 percent lower following Wall Street's lackluster performance overnight and on concerns over inflation after fuel price hikes.
Dealers said the prospect of a further rise in international oil prices, which was partially to blame for New York's falls, added to the negative local tone.
The composite index shed 2.85 points to 916.93 on volume of 792.72 million shares.
Bangkok share prices closed flat as investors adopted a wait-and-see stance ahead of major mass political rallies to be held during the weekend.
Dealers said the Thai market held firm on buying of energy shares but overall gains were limited due to a prolonged political impasse over the leadership of embattled Prime Minister Thaksin Shinawatra.
The composite index rose just 0.87 points to 753.39 on turnover of 2.4 billion shares.
Jakarta share prices closed 0.93 percent higher led by mining stocks, with blue chip Astra International extending its gains on hopes of better car sales.
Dealers said mining stocks rose as they benefited from strong world commodity prices overnight.
The composite index closed up 11.587 points at 1,261.265 on volume of 1.35 billion shares.
In Manila share prices closed 0.34 percent lower as profit-taking set in after a four-day rally.
The composite index slipped 7.24 points to 2,130.37.
Wellington share prices closed flat as gains in market leader Telecom were offset by losses in other heavyweights.
The NZSX-50 gross index rose 0.23 points to 3,407.55.
Mumbai share prices fell 0.30 percent, breaking a four-day winning streak amid lacklustre trading and profit taking in blue-chip stocks.
Dealers said telecommunication stocks bucked the trend, rising on media reports following a Supreme Court ruling barring state governments from collecting sales tax from telecom service providers.
The 30-share SENSEX fell 31.35 points to 10,595.43.
"Trading sentiment was cautious at this stage with investors not keen to build up positions ahead of the weekend. We expect markets to remain rangebound next week," said Soumeel Chaterjee of brokerage KJMC Capital Market Services.
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