Asian stocks slack after last week's gains


Stocks dropped on worries about banks in Japan, where passersby check out Christ-mas trees made of champagne glasses

By staff and wire reports

HONG KONG, China -- Asian stocks sold off on Monday, feeling pressure from a U.S. stock slide at the end of last week.

Bank stocks put pressure on Japanese stocks. UFJ Holdings, Japan's fourth-biggest bank, dropped 11.3 percent to a lifetime low of 297,000 yen.

It got little spark from news it is selling its U.S. subsidiary United California Bank to BNP Paribas for $2.4 billion. UFJ expects to wrap that sale by the end of the business year in March 2002.

Faced with persistent worries about Japan's worsening economy, the Nikkei 225 index closed off 2.1 percent at 10,571.01.

The broader Topix index lost 2.14 percent to end at 1,023.34, a sign of broad-based selling.

South Korea suffers most

Japan wasn't the only one to suffer. Stocks dropped sharply in South Korea, one of Asia's strongest performers in recent weeks.

They also ended a little lower in Hong Kong, Australia and New Zealand.

The market in Singapore was down shortly ahead of the close, with Indian stocks trading essentially flat in the afternoon.

Japan made its fourth recession in a decade official last Friday, posting its second straight negative quarter.

That lag had investors worried about problems with Japan's banks on Monday. Many Japan watchers regard problems with bad loans as the biggest challenge facing the world's No. 2 economy.

Fears about rising bad loans drove stock in Mizuho Holdings Inc., the largest bank in the world by assets, down 8.4 percent to 251,000 yen.

Trading company Marubeni Corp. dropped 6.25 percent to 90 yen.

High tech stocks dropped with the rest of the market. Tech benchmark Sony Corp. fell 1.8 percent to 6,030 yen.

Sony, a big exporter, got a little boost from the weakening yen. The Japanese currency is bumping against 126 to the U.S. dollar.

Steelmaker NKK Corp. rose 5.2 percent to 81 yen. USX-U.S. Steel Corp. is in talks to buy its loss-making National Steel Corp. subsidiary.

Sydney hit by News Corp. selloff

Australia's benchmark S&P/ASX 200 index lost 0.33 percent on Monday, closing at 3,360.7.

That snapped three days of gains. News Corp., the biggest listing, was the main drag, dropping 2.3 percent to A$15.98.

Eyes are watching for a bid from News Chairman Rupert Murdoch for control of Germany's Gruppe Kirch.

Telstra didn't help Sydney bulls, the telecom dropping 1.8 percent to A$5.44.

Kerry Packer's Publishing & Broadcasting fell 3.1 percent to A$9.85. Packer, who had a kidney transplant last year, was admitted to hospital on Friday, reportedly for a routine procedure.

Gold stocks bucked the downtrend, helped by a 3.6 percent gain in Normandy Mining, which ended at A$1.75.

U.S.-based gold giant Newmont has revised its offer for Normandy to A$1.90 in cash and stock.

In New Zealand, the benchmark NZSE-40 Capital index lost 0.99 percent to end at 2,052.56.

The biggest stock, Telecom New Zealand, was a weight on the index, falling 0.98 percent to NZ$5.04.

It announced a joint venture with America Online (CNN's parent) and Australia's Channel Seven to provide AOL service in Australia.

Funds selling in Seoul

South Korean stocks were big losers on Monday, the Kospi collapsing 5.07 percent to 668.77.

Samsung Electronics, the largest stock and a favorite holding of overseas funds, fell 8.3 percent to 260,000 won.

SK Telecom Co., the largest mobile-phone carrier and another fund favorite, dropped 7.17 percent to 252,500 won.

Steel giant Pohang Iron and Steel Corp. gave up 9.8 percent to 114,500 won.

Investors said it just seemed like time to sell.

Taiwan modestly down

The benchmark Taiex lost 0.24 percent to end at 5,321.28, settling back after hitting a seven-month high.

The electronics subindex, which normally drives the market, fell 2.4 percent after Nasdaq dropped 1.6 percent on Friday.

World contract chipmaking No. 2 United Microelectronics Corp. slumped 6.02 percent to T$48.40. It had gained 30 percent last week.

Winbond Electronics had another banner day, rising the 7 percent limit for a one-day move in Taiwan, to T$19.30.

Bank stocks settled down after strong gains last week.

China stocks up on eve of WTO

Hong Kong's Hang Seng index closed down as well, off 0.4 percent at 11,784.92.

The biggest stock, bank HSBC, was a millstone, down 1.5 percent at HK$97.25.

Property stocks went against the grain, with the Hang Seng property index climbing 0.26 percent. Investors have been optimistic since last week that the property market has bottomed in Hong Kong.

Legend Holdings, the largest computer maker in mainland China, dropped 1.97 percent to HK$3.725.

China's B shares gained on the eve of China's official entry into the World Trade Organization.

The Shanghai B share market ran up 2.47 percent. Shenzhen's B shares gained 1.8 percent.

In Singapore, the Straits Times index was down 0.44 percent at 1,621.66 in the last hour of trade.

One trader said a correction was healthy after the market's recent rise. But the underpinnings seemed solid.

In India, the Mumbai main index was up 0.23 percent at 3,444.28 in afternoon trade, and gaining. Cement stocks were doing well on hopes of a price increase.

Reuters contributed to this report.