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Business News/ Money / Asian stocks waver on Greek concerns, euro edges up
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Asian stocks waver on Greek concerns, euro edges up

Asian stocks waver on Greek concerns, euro edges up

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Singapore: Asian shares fell but the euro inched higher on Thursday from a one-year low the previous day as senior European officials gave assurances that they were serious about helping Greece find a way out of its escalating debt crisis.

The US Federal Reserve’s upbeat assessment of the world’s largest economy and decision to keep interest rates near record low, also lent some support to shares in Asia, though most markets failed to gain traction as European Union members squabbled over details of a Greek bailout.

The MSCI index of Asian stocks outside of Japan was off about 0.1%, while Japanese markets were closed for the start of the country’s long Golden Week holiday.

Shanghai stocks shed more than a percent, while Hong Kong stocks lost 0.8%.

Retailer Esprit Holdings, which receives about a quarter of its revenue from Europe, fell 4.7%. It was the top loser on the Hang Seng index as a credit rating downgrade of Spain fuelled fears of eurozone instability.

Australian stocks fell 0.8% as no.4 lender Australia and New Zealand Banking Group led banks down after disappointing investors with a smaller dividend hike than expected.

“People are looking for a bit of an excuse to sell after six weeks of nearly uninterrupted gains," said Daniel Manley, a dealer at Burrell & Co.

ANZ was the first of Australia’s top banks to report results, and investors who had pushed bank shares up in the lead-up to results took its weaker-than-expected dividend as a sign of caution for the rest of the sector.

“The fact that the dividend is a bit less than expected means that may happen for the other two," said Manley, referring to Westpac Banking Corp and National Australia Bank reporting in early May.

Miners dropped again, hit as investors switched to defensive stocks in health care. Investors fear the Australian government will slap a new tax on miners and oil and gas producers.

Proposals to overhaul Australia’s tax regime are to be unveiled on Sunday.

“Uncertainty around government policy is never good for investment in any sector. And this is the first time in a long time that we’ve had uncertainty around the federal government’s tax position with regards to the mining industry," said James Bruce, a portfolio manager at Perpetual Investments.

South Korean shares finished 0.3% lower pressured by losses in retailers and shipyards, but gains in autos, with Hyundai Motor hitting a fresh historical high, lent support.

Hyundai Motor closed up 3%, while Kia Motors Corp rose nearly 2%.

Hyundai Motor and Kia Motors are aiming to bump up sales in China by almost a quarter this year, heating up competition with global and local rivals.

Taiwan stocks also ended down 0.3% as a bullish outlook from HTC Corp was offset by lingering concern over the Greek debt crisis and China’s property market tightening moves.

However, shares in Singapore and India bucked the downtrend, rising 0.9% and 0.7%, respectively.

The dollar was trading close to flat versus a currency basket, after rallying to a near one-year high on Wednesday. The yen was broadly flat versus the dollar.

Gold rose towards $1,170 an ounce as concerns over the eurozone’s fiscal health after ratings downgrades of Greece, Spain and Portugal fuelled buying of the metal as a haven from risk.

Oil rose towards $84 a barrel on encouraging signs of buoyant US fuel demand.

“There’s still a feeling that demand is robust and that the broad outlook is good. It’s been largely ignoring other developments," said oil broker Christopher Bellew at Bache Commodities, also highlighting strong growth in Asian countries such as China.

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Published: 29 Apr 2010, 04:16 PM IST
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