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Business News/ Market / Stock-market-news/  Asian markets mixed in volatile trade
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Asian markets mixed in volatile trade

Tokyo up 0.89%, Seoul adds 0.22%, Sydney drops 1.56%, Hong Kong down 0.23%, Shanghai gains 0.57%

Regional markets swung wildly after falling on Thursday on weak Chinese data and indications from US Federal Reserve chief Ben Bernanke that the Fed could start reducing its $85 billion-a-month bond-buying programme at one of the next few meetings. Photo: Reuters (Reuters )Premium
Regional markets swung wildly after falling on Thursday on weak Chinese data and indications from US Federal Reserve chief Ben Bernanke that the Fed could start reducing its $85 billion-a-month bond-buying programme at one of the next few meetings. Photo: Reuters
(Reuters )

Hong Kong: Asian markets were mixed on Friday in roller coaster trade after routs sparked in part by fears of tighter US monetary policy, with Tokyo ending higher a day after suffering its worst drop since the March 2011 quake-tsunami disaster.

Regional markets swung wildly after falling on Thursday on weak Chinese data and indications from US Federal Reserve (Fed) chief Ben Bernanke that the Fed could start reducing its $85 billion-a-month bond-buying programme at one of the next few meetings.

Tokyo, which plunged 7.3% in the previous session during frenzied selling, ended up 0.89%, or 128.47 points, at 14,612.45.

The Nikkei had bounced back in the morning but plummeted by as much as 3.37% after lunch before regaining ground.

Seoul closed up 0.22%, or 4.26 points at 1,973.45. Sydney dropped 1.56%, or 78.9 points, to end the day at 4,983.5, after its worst week of trading for a year.

Hong Kong stocks closed down 0.23%, or 51.01 points, at 22,618.67, but Shanghai finished up 0.57%, or 12.86 points, at 2,288.53.

The volatility in Asia came after US stocks ended slightly lower Thursday, with the Dow Jones Industrial Average falling 0.08%, or 12.67 points, to 15,294.50, with Wall Street boosted by better-than-expected US housing and jobless data.

European markets took a heavier hit, with most indices, including London, Frankfurt and Paris, dropping more than two%, following the Asian lead, but the bourses rebounded slightly at the start of trading on Friday.

Toshikazu Horiuchi, a broker with IwaiCosmo Securities in Japan, said “extremely nervous" trading saw some investors lock in profits with others searching out bargains after Thursday’s plunge.

“Players rushed to profit-taking after monitoring a moderate gain in the morning as they wanted to secure profit ahead of the weekend," he said.

Earlier, Kenji Shiomura, strategist at Daiwa Securities, described Thursday’s drop as a temporary correction to recent advances.

“There has not been any grave event that could change corporate earnings outlooks and what happened yesterday (Thursday) should be a correction to the recent excessive rises," he said.

Prime Minister Shinzo Abe’s pro-spending, pro-growth policies have weakened the yen more than 20% against the dollar over the past six months helping to boost share prices nearly 60%.

But some analysts had warned a correction was overdue.

The “slump is not necessarily the end of the bull market in Japanese equities, but the next few months will be much harder going", London-based Capital Economics said in a note before afternoon trading.

Selling pressure on Thursday was accelerated when British banking giant HSBC said its preliminary Purchasing Managers’ Index (PMI) for China fell to a seven-month low of 49.6 in May, putting it below the 50 mark indicating contraction.

“Weaker manufacturing PMI has dashed hopes of an economic recovery and capped upward momentum," said Soochow Securities analyst Deng Wenyuan in China, the world’s second-largest economy.

Japanese stocks were also tracing zigzagging yen movements, with a weak yen tending to boost the market. The dollar was at 101.60 yen late in Asia compared with 101.82 yen Thursday in New York.

“We could be at a point of reckoning for the weak yen, which has powered the stock market’s rise to the present," said Investrust chief executive Hiroyuki Fukunaga.

“Players have switched from buying Nikkei futures and shorting the yen to doing the opposite, with individual investors piling in, adding to the volatility."

The euro was at 131.66 yen from 131.72 yen in New York and at $1.2960 from $1.2935.

New York’s main contract, West Texas Intermediate light sweet crude for July, was up four cents at $94.29 a barrel and Brent North Sea crude was down six cents at $102.38.

There was no trading Friday in Singapore, Bangkok or Kuala Lumpur.

Gold was at $1386.10 at 1050 GMT Friday from $1,388.57 late Thursday.

In other markets:

—Jakarta ended up 0.66%, or 33.69 points, at 5,155.09.

Indah Kiat Pulp and Paper rose 4.61% to 1,590 rupiah, while food company Indofood Sukses Makmur fell 0.66% to 7,500 rupiah.

—Manila closed down 0.62%, or 45.47 points, to 7,268.91.

Top-traded Ayala Land led the retreat, dropping 0.57% to 34.80 pesos. Bank of the Philippine Islands lost 2.03% to 101.60 pesos, while Metropolitan Bank ended 0.59% lower at 133.70 pesos.

—Mumbai rose 0.15%, or 30.0 points,to 19,704.33 points.

Private steel producer Tata Steel Ltd rose 4.56% to 313.15 while engineering giant Larsen and Toubro Ltd rose 2.70% to 1,456.90.

—Taipei fell 0.34%, or 28.05 points, to 8,209.78.

Taiwan Semiconductor Manufacturing Co rose 1.39% to Tw$109.5 while HTC fell 1.24% to Tw$279.0.

—Wellington fell 1.36%, or 62.35 points to 4,526.24.

Telecom Corp. was down 3.16% at NZ$2.30 while Fletcher Building was down 1.30% at NZ$8.38.

Dow Jones Newswires contributed to this story.

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Published: 24 May 2013, 02:20 PM IST
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