Asian markets lower on tech slump


Koizumi vowed anew to forge ahead with vital but painful changes to get Japan's economy back on track when he addressed the parliament on Monday

HONG KONG, China -- Tokyo dragged Asian markets to a lower close Monday, with poor performances from Japanese banks and tech issues ending hopes for a speedy recovery.

The tech-sensitive Nikkei average shed 1.63 percent or 159.50 points to 9,631.93 -- its lowest close since September 21 last year.

The broader capital-weighted TOPIX index dropped 12.75 points or 1.33 percent to a new 17-year low of 943.51.

Elsewhere in the region, Korea, Taiwan and Singapore all ended in the red, but Australia and Hong Kong were among the gainers.

Tokyo stocks fell sharply by the end of the day, with NEC Corp leading a broad-based decline amid worries over Japan's structural reforms.

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Japanese Prime Minister Junichiro Koizumi vows to get Japan's economy back on track. CNN's Rebecca MacKinnon reports (February 4)

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NEC gave up 5.56 percent to end at a 39-month closing low of 884 yen after it doubled its group net loss forecast for the current business year.

Big banks were weak. Mizuho Holdings closed at a new low of 203,000 yen, down 6.88 percent.

Mitsubishi Tokyo Financial Group dipped 2.8 percent, UFJ Holdings was off 2.5 percent and Sumitomo Mitsui lost 4.26 percent to 427 yen -- also a record low.

The ratings slump for Prime Minister Junichiro Koizumi also weighed on the market, as it ignited fears the government will now lack the power to carry out much-needed economic reform.

Koizumi's support rating has tumbled following his sacking last week of popular Foreign Minister Makiko Tanaka.

The beleaguered yen was also hit by market confusion over Japan's foreign exchange policy.

The U.S. dollar settled back to 133.40/47, having moved in a range of 132.85 and 133.25, after the country's top financial diplomat, Haruhiko Kuroda said Japan's foreign exchange policy remained unchanged.

Hynix downgrade

South Korean shares finished lower as Hynix Semiconductor lost ground when a local brokerage downgraded the rating on the troubled chipmaker.

The bellwether Kospi closed down 1.64 percent at 730.21, while the over-the-counter Kosdaq slid 2.24 percent to 74.28.

Hynix, the world's third largest memory chipmaker, shed 6.3 percent to 2,450 won after it was downgraded by Hyundai Securities, which cited increasing risks for shareholders.

Hyundai Securities cut Hynix's rating to "market perform" from "strong buy". it said Hynix's share price would drop if it sells its dynamic random access memory (DRAM) business to U.S. Micron Technology for about $4 billion.

The brokerage recommended investors to increase their weighting on Samsung Electronics due to rising chip prices.

Samsung added 0.97 percent to 312,000 won after the announcement.

SK Telecom, South Korea's largest mobile carrier, closed down 2.39 percent at 245,000 won after it was hit by heavy selling.

Job ads up

The Australian stock market bucked the trend to finish strongly. Positive job advertising data helped bolster a run on major banks and resources, while media giant News Corp staged a rebound.

The ANZ jobs data showed a 12.5 percent jump in job advertisements for January, supporting hopes for strong economic growth.

The benchmark S&P/ASX 200 index closed up 20.6 points or 0.6 percent to 3,466.1, lifted by a late recovery from News Corp.

News Corp ended up one percent to A$13.55 after languishing most of the day. Analysts expect it will post disappointing earnings later this month.

Analysts said offshore buying also pushed Anglo Australian miner Rio Tinto to close 2.4 percent higher at A$40.55, while rival BHP Billiton added 2.3 percent to A$11.56.

Banking stocks were the other stalwarts on the day led by Commonwealth Bank, which gained 1.8 percent to A$33.38.

Westpac Bank added 1.5 percent to A$15.77 following media reports it was in talks to sell its AGC consumer credit business.

ANZ rose 0.8 percent to A$17.64, while market leader National Australia Bank closed up eight cents to A$34.63.

'Long vacation effect'

Taiwan stocks ended slightly lower as investors took profits on blue chips while others stayed on the sidelines ahead of a long market holiday beginning next week.

The benchmark Taiex edged down 8.08 points or 0.14 percent at 5,849.85.

The market is expected to improve after the uncertainty of the long holiday is over. The market will be closed from February 7 for the Lunar New Year Holiday and will reopen on February 18.

Dynamic random access memory chipmaker Winbond Electronics fell 2.54 percent to T$26.90.

Technical rebound

In other markets, Hong Kong stocks held firm on technical rebounds in telecom issues and gains in property stocks ahead of the territory's final land auction of the current fiscal year.

The Hang Seng Index closed up 30.07 points or 0.28 percent at 10,721.32.

Keeping the index in positive territory was China Mobile, which gained 1.35 percent to HK$22.60. Its rival China Unicom was also up 1.33 percent at HK$7.60.

Shares in Singapore were soft on concerns over Japan's structural reforms.

Analysts however said hopes for a Chinese New Year rally has prevented the market from slipping.

The key Straits Times Index was down 1.57 percent or 28.07 points at 1,753.35 near the end of trading.