Tokyo the exception as Asian markets ascend

Tokyo the exception as Asian markets ascend

HONG KONG (AFP): Most Asia-Pacific stock markets rallied
Thursday as investors cheered the surging yen, but Tokyo stayed
out of the party on concerns the stronger currency could harm
Japanese exports.

Japan's Nikkei tumbled 5.8 percent, giving up almost all the
gains notched up the previous day, paced by falls in export-
oriented counters.

Elsewhere in the region, Jakarta and Bangkok soared 8.4
percent each, Taipei closed 4.4 percent up, Singapore gained 3.2
percent, Hong Kong rose 2. 5 percent, and Manila advanced 3.1
percent.

Kuala Lumpur rose 0.5 percent in directionless trade and Seoul
reversed early gains to end lower on futures-led selling. Sydney
dropped 1.5 percent on the Nikkei's loss.

Dealers attributed the regional gains mainly to the strength
of the yen, which rose in early European trade to 116.11 against
the dollar, its highest point in more than a year, after pulling
up other Asian units along with it.

Investors unwound long-dollar positions, scared by US Federal
Reserve chairman Alan Greenspan's warning the previous day that
the outlook for the US economy next year "has weakened
measurably" due to global financial turmoil.

Expectations of lower interest rates also helped bolster
regional market sentiment.

But the yen's new-found strength raised concerns in Tokyo that
exports would take a hit at a time when Japanese firms are
relying on overseas markets to boost earnings while battling a
recession at home.

In Hong Kong, stock prices closed sharply higher on hopes for
a cut in local interest rates and signs of a more flexible
government approach to housing policy.

The key Hang Seng Index ended up 194.79 points at 7,939.51
after breaching the psychological 8,000 point barrier earlier in
the day.

Property stocks were the star performers far outpacing the
market with gains of around 8.0 percent.

Vickers Ballas head of sales Anthony Mak the market was
expecting a cut in interest rates following the US Federal
Reserve's 0.25 percentage point cut.

"They expect the cut in local interest rates. If it doesn't
come this week it will be in the next couple of weeks," he said.

In Tokyo, Japanese stocks tumbled 5.8 percent, all but wiping
out huge gains from the day before, as the yen's surge against
the dollar sparked a sell-off of export-led blue chips, brokers
said.

Foreign investors sold international blue chips, particularly
electrical and high-tech issues, dumping positions on the yen's
rally driven by growing concerns over the US market, brokers
said.

Investors also took profits on banks, which had led a 6.2
percent rally in the key Nikkei index the previous day on hopes
that Japan would finally enact a solution to its banking crisis.

The 225-issue Nikkei average slumped 799.55 points to close at
13,026.06 while the Topix index of all issues on the first
section of the Tokyo Stock Exchange was down 45.48 points at
1,001.50.

In Singapore, share prices closed 3.2 percent higher, buoyed
by the announcement of an interest rate cut by United Overseas
Bank and expectations of more to come.

The Straits Times index rose 29.39 points to 950.96, while the
broader All-Singapore index ended 10.14 points up at 293.20.

In Sydney, the Australian Stock Exchange's main indicator, the
All Ordinaries index, closed down 36.9 points to 2,503.3.

In Kuala Lumpur, the key KLSE Composite Index ended 2.09
points higher to close at 372.99.

In Bangkok, the Stock Exchange of Thailand (SET) composite
index was 21.99 points higher at 285.22, its highest point since
July. The select SET 50 closed 1.94 points higher at 20.50
points.

In Manila, the Philippine Stock Exchange composite index rose
37.66 points to close at 1,250.41 points.

In Seoul, the Korea Stock Exchange index closed down 8.27
points at 305.22, off a high of 320.97. The benchmark corporate
bond yield was down at 10.5 percent. The won was at 1,362 against
the US dollar.

In Taipei, the Taiwan Stock Exchange weighted price index
gained 295.34 points to 6, 970.23, following a 2.1 percent rise
in the previous session.

In Shanghai, the Shanghai Stock Exchange's B-share index
gained 0.70 points to settle at 33.40 points while the A-share
index of locally traded stocks ended 15.74 points, or 1.2
percent, higher at 1,305.76 points.

In Auckland, the NZSE-40 index was up 13.73 points to 1729.61.