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Asian markets feel war fears
By Alex Frew McMillan
HONG KONG, China (CNN) -- Asian investors are starting the week in selling mood, driving markets sharply down through the region on Monday morning. Japan's Nikkei average was down 1.58 percent to 8,593.63, with the United States again pushing Iraq on weapons disposals. That is raising fears of war in investors' minds, pushing the Topix down 1.42 percent to 849.10 at noon. United Nations weapons inspectors are due to deliver their report later on Monday. Investors will also be watching George W. Bush's State of the Union speech on Tuesday. There is heavy selling in South Korea, where the market is off more than 3 percent. The country was also hard hit by a computer virus that struck over the weekend. (Full story) But Singapore's market is down 2 percent, and both Hong Kong and Taiwan are off more than 1.5 percent. New Zealand closed slightly lower. Markets are closed in Australia for Australia Day. Wall Street sold off hard on Friday, marking a second week of declines as war fears hit there. The Dow Jones industrial average slumped 2.85 percent to end at 8,131.01, while Nasdaq plunged 3.32 percent to finish at 1,342.14. (U.S. roundup) Big caps decline in TokyoIn Tokyo on Monday, traders are paying more attention to political risks in the Persian Gulf than the stream of earnings coming out of Wall Street.
Those have been generally positive. But a possible disruption of world trade over war is driving stocks like NTT DoCoMo lower, with Tokyo's largest listing down 2.44 percent to 240,000 yen. Its parent, NTT, is down 4.74 percent to 422,000 yen on a report that communications companies connected with power companies will soon start to compete in Internet services. The company's former president, Hisashi Shinto, died of pneumonia over the weekend. Higher oil prices stemming from tension over Iraq drove imports up in December, meaning a smaller than expected increase in Japan's trade surplus. (Full story) Yen eating into exportersLarge exporters are also feeling the effects of a stronger yen. Sony Corp. is down 1.8 percent to 4,910 yen, while Honda Motor is off 1.71 percent to 4,020 yen. The yen is a little stronger over its level from Friday, at 117.84 to the U.S. dollar. Japan's finance minister, Masajuro Shiokawa, is urging the central Bank of Japan to ease monetary policy, which would weaken the currency. Banks are also lower, with UFJ Holdings dipping 5.13 percent to 148,000 yen and Mitsubishi Tokyo Financial Group off 3.23 percent to 690,000 yen. Banks had gained last week after Mizuho announced a reorganization but their run of short covering now seems to have ended. HSBC lower again in Hong KongIn Hong Kong, the Hang Seng is down 1.68 percent at 9,302.06, with every one of its 33 components moving south.
Market leader HSBC is off 0.88 percent to HK$84.00, the bank sinking on fears of disruption to the global economy. U.S. oriented stocks are moving lower, with small-motor maker Johnson Electric off 3.37 percent to HK$8.60 and garment shipper Li & Fung down 3.25 percent to HK$7.45. Legend Group, parent of China's largest computer maker, is down 4.96 percent to HK$2.875 ahead of its earnings on Wednesday. New Zealand's Top 40 closed down 0.3 percent to 1,995.19, with Telecom New Zealand off 0.65 percent to NZ$4.56. The city of Auckland was also on holiday on Monday, celebrating anniversary day. Australian markets will resume trade on Tuesday. TSMC drives Taiwan lowerIn Taiwan, the Taiex is down 1.74 percent at 4,969.16 in late morning, with techs bearing the brunt of Nasdaq's selloff. Chip foundry TSMC, the largest stock listed in Taipei, is down 1.82 percent to T$48.50. Banks are holding up relatively well, though, with Mega Financial Holdings off 0.50 percent to T$19.80 in heavy trade and the bank subindex slightly higher. China Airlines is up 1.18 percent to T$17.10 after the airline completed the first commercial charter flight to China in 50 years, for the Lunar New Year holiday. Taiwan's market will close for a week as of January 29 to mark the start of the Year of the Goat. Korea sees Asia's largest declineSouth Korea's Kospi is again the biggest decliner in Asia, off 3.18 percent to 590.07. Chip and electronics maker Samsung Electronics, Seoul's largest listing, is driving the market lower with a 4.15 percent plunge to 300,000 won.
Retailer Shinsegae is off 2.88 percent to 152,000 won, with worries over economic disruption counteracting the increased business the department store chain will likely see over the Lunar New Year. Steelmaker Posco is giving up 3.19 percent to 121,500 won as afternoon trading gets going. Korean Internet users saw traffic slow to a crawl over the weekend as the country was hit by the SQL Slammer worm, which targeted Microsoft Corp. software. Techs lead Singapore sellingSingapore's Straits Times index is down 2.0 percent to 1,330.84, techs again among the heaviest sellers. Creative Technology is down 3.10 percent to S$12.50, while Chartered Semiconductor is off 2.67 percent to S$0.73 in the heaviest selling. But the market is broadly lower, bank stock UOB off 2.59 percent to S$11.30 and SingTel down 2.21 percent to S$1.33. In Malaysia, the Kuala Lumpur composite is off 0.98 percent to 662.25.
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