Asian stocks close mixed amid late profit taking

HONG KONG, Dec 7, 2007 (AFP) - Asian stocks closed mixed on Friday after late profit taking eroded earlier gains made on the back of another buoyant performance by Wall Street overnight.

Moves by US President George W. Bush to help struggling homeowners caught up in the subprime mortgage crisis and the prospect of a US interest rate cut next week had underpinned morning trade.

The US Federal Reserve is set to meet on December 11.

However, gains were unconvincing as benchmarks nudged closer to technical resistance levels prompting investors to lock in some of their gains ahead of the weekend.

Shanghai was among the best on the day with a 1.13 percent gain, Wellington was up 1.22 percent, Sydney rose 0.8 percent as Taipei advanced 0.32 percent and Tokyo ended up 0.52 percent. Mumbai was 0.86 percent higher.

Singapore was little changed, Hong Kong slumped 2.42 percent, Seoul shed 1.0 percent, Kuala Lumpur eased 0.4 percent, Jakarta fell 0.6 percent and Bangkok was off 0.45 percent.

TOKYO: Japanese share prices closed up 0.52 percent at a one-month high as investors took heart from a White House plan to help struggling US homeowners.

But dealers said shares ended below the key 16,000 points level as profit-taking emerged in late trade ahead of key US jobs data. Exporters were supported by a softer yen.

The Nikkei-225 index gained 82.29 points to 15,956.37. Volume traded rose to 2.18 billion shares from 1.9 billion Thursday.

Investors took their lead from Wall Street where shares rose for a second straight session overnight as investors welcomed the US mortgage rescue plan.

But shares ended off their highs of the day amid jitters about key monthly US jobs figures due later Friday, and some doubts about how successful the White House plan will be in easing the US subprime loan crisis, dealers said.

"Investors are still uncertain about the (US non-farm payrolls data) and whether the government rescue plan will work," said Masatoshi Sato, a senior strategist at Mizuho Investors Securities.

HONG KONG: Hong Kong share prices reversed early gains to close 2.42 percent lower on profit-taking in local properties and banks following recent strong gains.

Dealers said investors factored in recent good trading leads including rate cut hopes and thought it a good time to lock in profits ahead of the weekend after the key index gained more than 2,000 points in the past seven trading days.

They noted that investors became cautious on uncertainty over whether the US government's plan to help financially-strapped homeowners would really be able to ease subprime fears.

The Hang Seng index closed down 716.45 points at 28,842.47. Turnover was 140.12 billion Hong Kong dollars (18 billion US).

"The market closed sharply lower with properties and banks leading the major falls as investors took profit after the recent rally," said DBS sales director Peter Lai.

"After the 2,000-point gain (over the past) seven sessions, investors turned cautious and preferred to lock in gains ahead of the weekend," he said.

SYDNEY: Australian share prices closed up 0.8 percent, tracking gains on US markets.

The S&P/ASX 200 closed up 53.8 points at 6,654.7. Volume traded was 1.80 billion shares worth 5.48 billion dollars (4.8 billion US).

"We have seen a level of confidence creeping back into the market today, particularly in the financial sector," said Matt Lewis, a senior dealer at CMC Markets.

"Traders are seemingly optimistic about US regulators' plan to limit subprime defaults. This bodes well, with all the big four banks showing gains."

The plan to allow interest rates for certain subprime mortgages to be frozen for five years is aimed at slowing the pace of foreclosures so the housing market has time to stabilize and recover.

SHANGHAI: Chinese share prices ended up 1.13 percent, buoyed by a rebound in steel shares and gains on Wall Street overnight.

But dealers said sentiment remained fragile after a government announcement this week that China would shift its monetary policy stance from prudent to "tight" in 2008 to tame inflation and prevent economic overheating.

Other metal stocks also jumped after Canadian miner Northern Peru Copper Corp said late Thursday that it had agreed to a cash takeover offer of 455 million Canadian dollars (450 million dollars) by Jiangxi Copper and state-run China Minmetals Nonferrous Metals Co.

The Composite Index gained 56.68 points to 5,091.76 on turnover of 71.66 billion yuan (9.6 billion dollars).

"The policy shift will have a long-term impact on the economy. The market may continue to fluctuate due to uncertainty over government policy," said Cao Yan, an analyst at Soochow Securities.

TAIPEI: Taiwan share prices closed 0.32 percent higher as late selling pared early gains inspired by Wall Street's rise on a US government's rescue plan for its mortgage sector.

The weighted index closed up 27.97 points at 8,722.38 on turnover of 115.08 billion Taiwan dollars (3.56 billion US).

An increase in the amount of purchases by foreign investors Thursday boosted the market in early trade. Net selling by foreigners had battered the Taipei bourse in recent weeks, dealers said.

However, profit-taking and loss-cutting pressure emerged in late trade given lingering global economic uncertainties.

Michael On, president of Beyond Asset Management, said early rises were offset by the still cautious sentiment.

SEOUL: South Korean share prices closed 1.0 percent lower as investors opted to take profits on recent gains after the Bank of Korea kept its key rate unchanged.

Dealers said the market opened firmer on Wall Street's advance following the announcement of a rescue plan for US mortgage loan holders.

But caution set in at midday as investors turned their attention to key events next week such as the Fed's rate decision and the expiry of options and futures contracts for index and individual stocks in Seoul.

The central bank kept its call rate target unchanged at five percent for a fourth straight month due to persistent worry over the US economy.

The KOSPI index closed down 18.85 points at 1,934.32. Volume was 355 million shares worth 6.1 trillion won (6.6 billion dollars).

"The KOSPI is marching towards the 2,000 level again on improving external conditions, but the momentum may slow next week," Woori Investment Securities analyst Cho Han-Jo said.

SINGAPORE: Singapore share prices closed steady as investors waited for the outcome of next week's Federal Reserve meeting to see if US interest rates will be cut again.

Dealers said another cut in US interest rates is widely expected when the Federal Reserve meets Tuesday and analysts are tipping half a percentage point reduction in the federal funds rate.

The Straits Times Index gained 5.40 points to 3,557.95 on volume of 1.77 billion shares worth 2.27 billion Singapore dollars (1.58 billion US).

"We are fairly certain that there will be a cut in the US interest rate, regardless of the employment numbers" for November coming out later Friday, Westcomb Securities said in a client note.

KUALA LUMPUR: Malaysian share prices closed down 0.4 percent as investors sold off selected blue chips after the key index hit fresh records three times earlier this week.

The composite index lost 6.35 points to 1,434.04.

BANGKOK: Thai share prices closed 0.45 percent lower Friday as investors stayed on the sidelines ahead of the US Federal Reserve's rate-setting meeting next week.

Dealers said the Thai market also fell on profit-taking in energy-linked stocks.

The composite index fell 3.80 points to 841.39 on turnover of 1.4 billion shares worth 19.6 billion baht (582 million dollars).

"The market was under pressure on modest profit-taking following recent gains in the energy sector," said Sukit Udomsirikul, a market analyst at Siam City Securities.

Investors also sold shares ahead of a long weekend in Thailand, as well as the US central bank's monetary policy meeting on Tuesday amid growing hopes for another rate cut.

JAKARTA: Indonesian share prices closed 0.6 percent lower as profit-takers dominated the late session, putting telecom and mining stocks under pressure, ending a four-day rally.

Dealers said trading was upbeat in early trade in line with Wall Street's rise overnight after the US announced a rescue plan for badly indebted homeowners and after Bank Indonesia cut its key interest rate Thursday.

The composite index closed down 16.45 points at 2,778.95 on volume of 4.71 billion shares valued at 6.33 trillion rupiah (685 million dollars).

"I think the market's decline today was purely due to profit-taking as the market had been in a record-breaking rally the past few days," Paramitra Alfa Sekuritas analyst Pardomuan Sihombing said.

"Moreover, some stocks have been perceived to be over-valued, so market players decided to realize profits," Sihombing said.

MANILA: Philippine share prices closed 0.3 percent higher, buoyed by the upturn on Wall Street overnight as fears of an economic slowdown in the United States eased.

The composite index finished up 11.43 points at 3,745.39. Volume amounted to 1.8 billion shares worth 4.8 billion pesos (114.96 million dollars).

The US market was lifted by US President George W. Bush's rescue plan for subprime home loan borrowers and amid continued expectations that the US Federal Reserve will lower interest rates by at least 25 basis points next week.

"That's one positive step to sooth investor fears about the subprime mortgage crisis," said Lawrence de Leon of Accord Capital Equities. "That's one less worry for investors."

WELLINGTON: New Zealand share prices rose 1.22 percent after a late rebound.

The NZX-50 index rose 49.43 points to 4,092.93 on turnover worth 109 million dollars (84.8 million US).

MUMBAI: Indian share prices closed up 0.86 percent, after Wall Street rallied overnight after US President George W. Bush announced a mortgage rescue plan to help struggling US homeowners.

Dealers said expectations of the US Federal Reserve cutting interest rates at its next meeting raised hopes of capital inflows towards emerging markets like India.

The 30-share Sensex index rose 170.13 points to 19,966.

Banking, software and property stocks were main gainers.

"The markets continues to rise on expectations of a US Fed rate hike. Software stocks rose after having lagged in previous months due to the firm rupee," said Bhaskar Kapadia, a partner with brokerage Pyramid Securities.

The rupee was quoting unchanged at 39.41 against the dollar on Friday.