Thursday, March 29, 2012

Asian markets mostly off after weak Wall St lead

HONG KONG: Asian markets edged lower Wednesday following a slip on Wall Street and on profit-taking after the previous day's strong showing.

While there were few incentives to buy, the lingering concerns over China's slowing economy continued to play on confidence.

Tokyo fell 0.71 per cent, or 72.58 points, to 10,182.57 and Seoul slipped 0.39 per cent, or 8.02 points, to 2,031.74, but Sydney rose 0.98 per cent, or 42.2 points, to 4,343.5.

In the afternoon Hong Kong was 0.92 per cent lower and Shanghai gave up 1.90 per cent.

Investors consolidated their gains after a rally on Tuesday that was fuelled by comments from US Fed chief Ben Bernanke indicating the central bank would continue with its loose monetary policy.

However, while his speech on Monday was market-friendly, his warning that the economy still had a long way to go and that the recent jobless falls might not continue acted as a counterweight.

"Bernanke's comments about possible quantitative easing have created ambiguous feelings among traders," Justin Harper, strategist at IG Markets in Singapore, said in a note, according to Dow Jones Newswires.

"First there was early euphoria that cheap dollars would once again flood the market and prop up risk assets. But now the dust has settled it highlights that all may not be as rosy in the garden of US economic recovery as first thought."

And on Tuesday, Wall Street edged lower after a slip in the Conference Board's US consumer confidence index as well as a report from S&P-Case Shiller that home prices continued to fall in January.

The Dow index ended down 0.33 per cent, the S&P 500 dropped 0.28 per cent and tech-rich Nasdaq edged 0.07 per cent lower.

Markets had surged in the first two months of 2012 thanks to improving confidence in the US economy and easing tensions over Europe's debt crisis, but a string of bad data out of China and profit-taking has weighed on equities in March.

In Tokyo Wednesday the standout performer was electronics giant Sharp.

The firm surged by its daily trading limit of 15 per cent after it announced Tuesday an $808 million tie-up with Taiwan's Hon Hai Precision, the parent company of manufacturing giant Foxconn, which builds gadgets for Apple.

On currency markets in early Asian trade the dollar bought 82.98 yen against 83.15 yen in New York late Tuesday.

The euro bought $1.3330 and 110.57 yen, compared with $1.3315 and 110.71 yen in New York.

Concerns that a spike in US inventories signalled falling demand send oil prices lower.

New York's main contract, West Texas Intermediate crude for delivery in May, shed 64 cents to $106.69 per barrel in the afternoon while Brent North Sea crude for May settlement was down 63 cents at $124.91.

Gold was at $1,677.50 an ounce at 0545 GMT, compared with $1,693.45 late Tuesday.

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Source From Channel News Asia

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