Approval Of U.S Bailout Plan Failed To Cheer Asian Markets

Nikkei Touch 3 Year Low While Sydney Came Back In Red

The stock markets across the Asian region closed mixed after the U.S. Senate approved a revised bailout package to rescue the U.S. financial system. However, concerns about a global slowdown persisted after the Institute for Supply Management said Wednesday that activity in the U.S. manufacturing sector contracted at a much faster pace than expected in September, with the index of activity in the sector falling to its lowest level in almost seven years. Additionally, major automakers around the world reported sluggish U.S. sales in September.

U.S. stocks closed yesterday’s volatile session modestly lower after seeing considerable weakness early in the day. The Dow closed down 0.2% at 10,831, the S&P 500 dropped 0.5% to 1,161, and the Nasdaq shed 1.1% to 2,069.

Oil prices eased US$0.29 to trade at US$98.24 a barrel by 3:08 a.m. ET. The contract for November delivery finished Wednesday's U.S. session at US$98.53 a barrel, down US$2.11 on higher U.S. inventory data. November crude-oil futures rose as much as $1.53 to $97 a barrel in electronic trading, after falling $1.78 to $98.89 a barrel Wednesday on the New York Mercantile Exchange.

In the currency market, the U.S. dollar eased to the upper 105-yen levels in late Tokyo deals, down from the lower 106-yen range seen in early trade and late Wednesday.

The Australian dollar closed at a 14-month low. The Aussie finished the session at US$0.7867-0.7871, down almost one U.S. cent from Wednesday's close of US$0.7962-66, marking the first session finish below US$0.79 in two weeks.

The New Zealand dollar gave away some of its gains after the U.S. Senate passed the revised U.S. bank bailout package. The kiwi finished the local session at US$0.6725, down from US$0.6746 in early trade, but was up from US$0.6703 late Wednesday.

The South Korean won tumbled to a 65-month low against the U.S. dollar. The won finished the local session at 1,223.5 a dollar, down 36.5 won from Wednesday's close of 1,187.0 a dollar, as offshore investors and importers bought the dollar.

The Japanese stock market closed sharply lower after it rebounded yesterday, ending a four-day losing streak. The market started off higher, but turned lower soon after the U.S. Senate approved a revised rescue package for the beleaguered U.S. banks.

The benchmark Nikkei 225 Average ended the day 1.9% lower at 11,154.76, its lowest finish in more than three years, while the broader Topix index lost 2.2% to 1,076.97. Both benchmarks had advanced earlier in the day.

On the economic front, the monetary base in Japan climbed 0.9% on year in September to 88.37 trillion yen, the Bank of Japan said Thursday. That followed a 0.2% annual decline in August and a 0.7% fall in July. On a seasonally adjusted basis, the monetary base soared 15.8% on year in September, standing at 89.398 trillion yen. That followed a 5.7% annual increase in August.

Meanwhile, the Ministry of Finance said that Japanese investors purchased a net 114.8 billion yen in foreign stocks for the week ended 26 September 2008. They also bought a net 361.0 billion yen in foreign bonds and notes during the same period. Meanwhile, foreign investors sold a net 236.8 billion yen in Japanese stocks, and they also unloaded a net 1.1 trillion yen in Japanese bonds and notes.

In Hong Kong, the Hang Seng Index finished 1.1% higher at 18,211.11, after sliding as low as 17,631.70 earlier in the day. The Hang Seng China Enterprises Index ended up 2.9% at 9,331.05.

The Australian stock market finished volatile trading session lower after it ended a four-day losing streak on Wednesday. The market started off firm, but turned lower after the U.S. Senate passed a revised rescue plan.

The benchmark S&P/ASX 200 index closed down 33.5 points or 0.7% at 4,761.1 after surging 4.22% on Wednesday. The broader All Ordinaries index lost 40.4 points or 0.8% to finish at 4,774.1.

On the economic front, Australia's trade surplus was A$1.36 billion in September, far above the consensus forecast that called for a surplus of A$200 million. It also represented the largest surplus since June 1997. Exports rose 6% to A$24.61 billion, while imports declined 2% to A$23.25 billion.

The New Zealand stock market closed higher, extending gains for the second consecutive trading session. The market started off higher, despite a weak lead form Wall Street, and finished the session in positive territory though most of the regional markets turned weak following news that the U.S. Senate has voted in favor of a bailout plan. The benchmark NZX 50 index closed up 44.68 points or 1.38% at 3,232.64 and the broader NZX All Capital index advanced 45.75 points or 1.40% to finish at 3,260.62.

On the economic front, New Zealand's commodity export price index fell by the most in 21 years in September, led by dairy, aluminium and beef, ANZ National Bank said in a report. The index dropped 4.9% from August when it fell 3.3%. Prices declined 1.9% from a year earlier.

The South Korean stocks closed lower for the fifth straight trading session on Thursday, as growing concerns over the global economy offset the positive outcome of a vote Wednesday in the U.S. Senate on the revised U.S. financial sector bailout bill. The benchmark Korea Composite Stock Price Index or KOSPI fell 20.02 points or 1.39% to finish at 1,419.65.

Stock markets on mainland China are closed this week for National Day holidays, while Indian markets were also closed on the account of National holiday.

Elsewhere, Taiwan's Taiex gave up 1.1% to 5,703.72 while Singapore's Straits Times Index also wavered between gains and losses, and was recently up 0.2% at 2,363.60.

In other regional market, European shares climbed after the U.S. Senate approved a revised $700 billion rescue plan for the financial sector and UBS said that it would report a quarterly profit, as investors wait for a decision on interest rates from the European Central Bank.

In the opening trade, the U.K. FTSE 100 index rose 0.9% to 5,005.91, the French CAC-40 index advanced 1.1% to 4,100.63 and the German DAX 30 index traded up 0.9% at 5,856.43.