Tokyo leads Asia to lower close


Analysts said the sacking of Foreign Minister Makiko Tanaka threatens to shake the core support of Koizumi's cabinet

HONG KONG, China -- Japan and other key Asian markets finished lower Wednesday after Wall Street's decline hurt investor sentiment and sparked a blue chip selloff.

In Tokyo, the benchmark Nikkei 225 average finished the day down 106.55 points or 1.06 percent to 9,919.48.

That put it below the psychologically important 10,000 mark for the first time since October.

The broader, capital-weighted TOPIX index fell 13.99 points or 1.43 percent to 964.75, a fresh 17-year low.

Hong Kong was also down sharply, closing more than 2.3 percent lower.

Japanese stocks slumped as the tumble on Wall Street and profit warnings at home hit blue chips.

Prime Minister Junichiro Koizumi's firing of his controversial but popular Foreign Minister Makiko Tanaka came as an additional burden, as it cast uncertainty over Koizumi's plan to push ahead with structural reforms.

High-tech sector under pressure

The high-tech sector came under pressure after technology exporters suffered from a triple whammy of a Nasdaq slide, a firmer yen, and dwindling corporate profits.

Toshiba fell 4.1 percent to 421 yen and Fujitsu Ltd lost 4.28 percent to 828 yen. The chip giants warned a day earlier of greater-than-expected losses this business year due to an infotech slump.

Market players also braced themselves for similar disappointment later this week from chip and computer maker NEC Corp. It ended down 3.29 percent at 1,058 yen.

Major banks also ended lower on worries about bad-loan problems.

Mizuho Holdings fell 5.39 percent to 228,000 yen and Sumitomo Mitsui Banking Corp lost 3.27 percent to 473 yen.

Consumer electronics leader Sony Corp was off 130 yen or 2.2 percent to 5790 yen.

Heavy selling in Seoul

Shares in Seoul were down on heavy selling by overseas investors. The main Kospi index lost 3.18 percent to close at 749.45, while the over-the-counter Kosdaq dropped 3.65 percent at 76.20.

But Hynix Semiconductor gained 10 percent to 2,520 won on market talk that firmer chip prices might help the South Korean chip giant to survive without an alliance with U.S. rival Micron Technology.

Investors have been keeping close tabs on merger talks between the two chip giants. Those talks hit a couple of snags this week due to pricing differences.

But mounting speculation that Hynix might opt to stay independent put pressure on rival Samsung Electronics. It lost 3.81 percent to 303,000 won.

Australia's share market also finished weaker after taking its cue from Wall Street.

The benchmark S&P/ASX 200 index finished down 19.4 points or 0.6 percent at 3,433.5.

Media giant News Corp fell 2.1 percent to A$13.33 on anticipated poor second-quarter earnings report due on February 12.

Big banks NAB, ANZ, CBA and Westpac were also lower, but resources leader BHP Billiton moved against the trend, putting on 9 cents or 0.81 percent to A$11.27.

Taiwan techs fall

In Taiwan shares closed lower for the second straight session. The market was hurt by falling tech issues and cautious investors, who stayed away from trading ahead of the Lunar New Year holidays.

The main Taiex index ended down 33.52 points or 0.57 percent at 5,812.67.

Memory chip maker Winbond Electronics bucked the downward trend, and rose the seven percent daily limit to T$28.70. Analysts attributed its gain to state buying.

Hong Kong stocks were sharply lower, led down by HSBC Holdings and China Mobile.

The benchmark Hang Seng Index closed 257.28 points or 2.34 percent lower at 10,756.968.

Heavyweights China Mobile dropped 2.6 percent to HK$22.45, while HSBC slipped 1.97 percent to HK$87.25.

Chinese automaker Denway Motors also plunged 5.68 percent to HK$1.91 on concerns that it may have to slash prices as competition heats up in the mainland's auto industry.

In Singapore, shares remained weak in the afternoon after Nasdaq's slide hit tech issues.

The bellwether Straits Times Index was down 0.65 percent at 1,759.72.

Chartered Semiconductor Manufacturing, which warned of more losses in the first quarter of the year, sank 4.2 percent to S$4.56.

United Overseas Bank also dropped 2.01 percent to S$14.60