Japan leads Asian markets lower by midday


Investors in Japan were disappointed after the Bush-Koizumi meeting failed to list specific economic recovery steps

HONG KONG, China -- Asian markets eased by midday Tuesday, with Tokyo dipping after the U.S.-Japan summit failed to produce concrete policy measures to revive Japan's ailing economy.

Tokyo shares were led down by banks as investors were left disappointed by the meeting between U.S. President George W. Bush and Japanese Prime Minister Junichiro Koizumi.

The benchmark Nikkei average ended the morning 128.26 points or 1.27 percent lower at 9,964.99, while the capital-weighted TOPIX index fell 16.74 points or 1.71 percent to 964.94.

Big banks Mizuho Holdings and UFJ Holdings both lost more than 5 percent.

In other markets, South Korea, Taiwan, Hong Kong and Singapore were weaker in early trade on the absence of market-moving news.

Australia, too, was weaker, dragged down by banks and miners. New Zealand was flat and the smaller markets in Southeast Asia strengthened.

No concrete measures

In a news conference after Monday's summit, Bush expressed support for Koizumi's economic reform agenda, even as the Japanese leader reiterated his resolve to take all possible steps to tackle deflation and prevent a financial crisis.

However, both leaders failed to mention concrete measures to help Japan's troubled banks or fight price falls, leaving investors who had expected a strong nudge from Japan's closest ally disenchanted.

Top lender Mizuho Holdings fell 5.63 percent to 218,000 yen, while UFJ Holdings Inc, the smallest among Japan's four mega-banks, lost 5.07 percent to 281,000 yen.

Mitsubishi Tokyo Financial Group gave up about 3.2 percent to 782,000 yen and Sumitomo Mitsui Banking Corp lost 3.3 percent to 463 yen.

Bucking the downtrend in Japan was Sony Corp, which rose 2.65 percent to 6,200 yen, after the Nihon Keizai Shimbun business daily said the consumer electronics leader would likely lift its operating profit to 270 billion yen ($2.04 billion) in the year starting in April.

That compares with a 130 billion yen profit forecast for the year to March.

Leading mobile telecom NTT DoCoMo dropped 0.72 percent at 1.39 million yen. Parent NTT was up 3000 yen or 0.75 percent to 397,000 yen.

Japan's largest car manufacturer, Toyota Motor dropped 2.83 percent at 3,430 yen, while Honda Motor fell 2.76 percent at 4,930 yen.

Upbeat earnings

South Korean shares pared initial gains in early trade as investors expressed doubt that President Bush's arrival in the country would bring new momentum to the market.

The bellwether Kospi dipped 0.34 percent to 787.71, while the over-the-counter Kosdaq was up 0.20 percent to 76.20.

But market heavyweights Samsung Electronics and Kia Motors firmed on upbeat corporate earnings.

Memory chip giant Samsung Electronics rose 0.87 percent to 346,000 won, but rival Hynix Semiconductor extended its fourth day of losses and dropped 6.3 percent to 1790 won as its alliance talks with U.S. rival Micron Technology lose force.

Kia Motors, South Korea's second largest carmaker, gained 4.2 percent to 11,250 won after it registered a 67 percent surge in 2001 net profit, a record in the company's history.

In Australia, shares remained modestly weak, with heavy selling in top stocks such as banks and miners.

But there was plenty of action among mid-cap stocks, including merger activity in the health and biotechnology, and wine sectors.

The benchmark S&P/ASX 200 index was down 1.55 percent or 5.4 points to 3,463.9.

After rushing to record highs on Monday on news they were contemplating a merger, shares in Australian Pharmaceutical Industries and Sigma Company both retreated in early trade.

Sigma and API were both last down 13 cents to A$4.70 and A$4.24 respectively.

Heavy selling

After opening higher, shares in Taiwan fell into narrow range trading on heavy selling. The benchmark Taiex share index was down about 80 points or 1.34 percent at 5888.74.

In Hong Kong, stocks were lower were supported by buying in some China-related oil and transport plays on hopes that Beijing will announce measures to spur consumer demand.

The Hang Seng index was down 117.56 points or 1.07 percent 10,885.25.

Dragging the index down were index heavyweights like conglomerate Hutchison Whampoa, which tracked the slide in European telecom stocks.

Hutchison fell 2.52 percent at HK$67.75. Banking leader HSBC was down 0.8 percent to HK$88.25.

In Singapore, the Straits Times index was off 17 points or about 1 percent at 1744 in late morning trade.