Asian stocks end fourth drop on U.S. selloff

By staff and wire reports

HONG KONG, China -- Asian stocks fell again Monday, as a sharp dip in U.S. markets on Friday rammed its way home.

Both Japan and Australia lost ground for their fourth straight day.

Virtually every market in the region was down, with South Korean stocks particularly hard hit.

Taiwan's markets slumped to a six-month low.

In Tokyo, the benchmark Nikkei index finished down 0.5 percent at 12,239.68. But better-than-expected machinery orders helped it rally in the afternoon from within a stone's throw of the psychologically key 12,000 mark.

The broader Topix index lost 1.3 percent to 1,237.90.

Chip makers heading south

High-tech bellwether Sony Corp. fell for a sixth session, as investors stayed skittish about the technology sector.

It ended down 1.4 percent at 7,150 yen, after falling as low as 7,030 yen, a fresh 22-month low.

Chip issues also headed south, battered by a slide in U.S. chip stocks last Friday.

Top chipmaker Toshiba Corp. slipped 3.6 percent to 589 yen. Tokyo Electron Ltd., which makes chip-making equipment, slid 3.1 percent to 6,640 yen.

High-tech stocks faced heavy selling pressure after a fresh salvo of profit warnings from overseas technology companies.

Telstra comes to Sydney's aid

In Australia, the benchmark S&P/ASX 200 index finished down 0.4 percent at 3,342.0. Investors were moving to cash or bonds as global prospects remain bleak.

Banks dropped again, with ANZ Bank leading the slide, down almost 2 percent to A$15.38. Financials had gained recently on investor caution.

Grocer Woolworths, another favorite play for defensive investors, rose 2.7 percent to A$10.49 on a strong sales report.

Losses would have been worse if not for a rebound in the market's second biggest stock. Telecom company Telstra, which has taken a pounding after a profit warning in June, surged 25 cents or almost five percent to A$5.30.

Traders posited a variety of reasons for the jump, first among them the stock's low price. Overseas investors were buying in, given Telstra's recent weakness.

"It is a long time since I have seen any stock as oversold as Telstra," said Eric Gale, J.P. Morgan's director of institutions.

In New Zealand, the NZSE-40 Capital index ended down 1.0 percent at 2,026.42. Wellington's biggest stock, Telecom New Zealand, lost 2.5 percent to NZ$5.15.

Hong Kong cell-phone stocks off

Hong Kong's Hang Seng index ended the day off 2.4 percent at 12,690.68.

China Mobile, the No. 1 cell-phone carrier in China, lost 4.4 to HK$39.00. Its competitor, China Unicom, dropped 4.0 percent to HK$13.50.

Hong Kong's largest stock, bank HSBC Holdings, lost 1.7 percent to HK$89.50.

Internet and telecom company Pacific Century CyberWorks staged an afternoon rally to end the day down 1.1 percent at HK$2.33. But the ravaged stock is still just off its year low of HK$2.15.

In Taipei, the benchmark Taiex ended down 1.1 percent at 4,657.30. That's its lowest close since Dec. 27, 2000.

It's not far from its five-year low of 4,586.75, set back in 1995.

Electronics shares, which drive the market, were sharply down.

Taiwan Semiconductor Manufacturing Co., the world's largest microchip foundry and the biggest stock, lost 3.2 percent to T$61.00.

In South Korea, the benchmark Kospi shed a dramatic 3.2 percent to close at 560.00. That's a 10-week low.

Again, technology stocks led the losses. Samsung Electronics, Korea's biggest stock and the biggest memory-chip maker in the world, lost 6.8 percent to 171,000 won.

Troubled chipmaker Hynix Semiconductor lost 11.2 percent to 2,055, an all-time low. Last week's profit warning from U.S. chipmaker Advanced Micro Devices has undermined confidence in Korean chip stocks.

In Singapore, the Straits Times index was trading down 0.6 percent at 1,651.07 in the late afternoon.

A rise in Nasdaq futures was helping techs back off their lows.

The only markets that made it in the black were minor: the Philippines, Thailand, Pakistan and Sri Lanka. Even among the winners, the gains were scant.

Reuters contributed to this report.