Nikkei leads Asian markets down

TOKYO, Japan (CNN) -- Tokyo stocks fell sharply by the close Wednesday, after an initial boost from the U.S. interest rate cut and gains on Wall Street.

The benchmark Nikkei 225 average snapped a four-day rally to end the day down 2.09 percent or 212.33 points to 9924.33.

It touched a high of 10,221.82 soon after the opening.

The broader capital-weighted TOPIX index was also down, losing 17.28 points or 1.62 percent to 1050.35.

Elsewhere in the region, most markets also opened higher, only to weaken by the end of the trading day.

New Zealand, Thailand close higher

New Zealand and Thailand closed higher, but Australia, Hong Kong, Taiwan, Singapore, Malaysia, Indonesia and the Philippines all ended in the red.

Korean stock markets remain closed for a national holiday but will reopen Thursday.

Mumbai's BSE Sensex was about half a percent lower in late afternoon trading.

Hong Kong's Hang Seng index broke through the 10,000 mark for the first time since September 11, but eased to close 0.54 percent or 53.56 points lower at 9897.14.

Japan's four-day rally came to an end Wednesday. Tech stocks including NEC, Hitachi and Toshiba were higher in early trade but then faded in the afternoon.


NTT DoCoMo, which launched its commercial 3G service on Monday, fell by more than 6 percent

Consumer electronics giant Sony continued its fall. Sony was down 1.7 percent to 3980 yen and has dropped about 8 percent since issuing a profit warning last Friday

Mobile phone leader NTT DoCoMo gave up 110,000 yen or 6.4 percent to end at 1.61 million yen.

The big banks, Mizuho Holdings, UFJ, Sumitomo Mitsui and Mitsubishi Tokyo Financial Group, were all down.

Initial optimism from rate cuts

Wall Street ended higher Tuesday, with the Dow Jones industrial average up 1.3 percent to 8950.59, and the Nasdaq composite up 0.8 percent to 1492.33.

After the market closed, the Fed cut interest rates by half a percentage point to 2.5 percent. It was the ninth rate cut this year.

"The U.S. Federal Reserve's move to cut by 50 basis points was within expectations, but U.S. investors drew some optimism from it and so should we," Kazunori Jinnai, general manager at Daiwa Securities SMBC's equity department, told Reuters news agency early Wednesday.

But that optimism dissipated later.

Top carmaker Toyota eased 4.7 percent to 3220 yen, while second-ranked Nissan dropped 4.2 percent to 503 yen. But No. 3 carmaker Honda continued to rise, putting on 1.74 percent to 4100 yen.

NTT Data, a big gainer on Tuesday, lost 6.5 percent or 39,000 yen to 566,000 yen, while telco NTT gave up 22,000 yen or 3.7 percent to 570,000 yen.

The LDP's tax panel on Tuesday agreed to abolish a capital gains tax payment option for shareholders in early 2003, clearing a key dispute over securities tax reform.

Australia ends half a percent lower

In Australia the S&P/ASX200 closed 14.6 points or half a percent lower at 3126.2.

Media giant News Corp, which warned this week its profit growth in 2001-02 would halve, eased 2.2 percent to A$12.80. Telco leader Telstra also eased 2.2 percent, while banking leader NAB was a rare gainer, up 1.6 percent to A$28.38.

Australia's Reserve Bank cut rates by a quarter of a percentage point Wednesday morning, while New Zealand's central bank left rates unchanged. It had cut by half a percentage point two weeks ago.

In Wellington, where Air New Zealand shares remain suspended, the NZSE Top 40 was up 1.49 percent or 27.87 points to 1895.81.

Hong Kong opened strongly, rising above the 10,000 mark for the first time since September 11, but then ran out of steam in the afternoon session to end below 9900.

Taiwan's Taiex moved in and out of the red before closing down 1.3 percent or 45.86 points at 3446.26, while Singapore's Straits Times index was softer near the close, down 5.82 points at 1344.50.

Reuters contributed to this report.