Going gets tough for Asia

Markets end mostly lower as the weak cues from the US markets and continued worries over the world economic conditions take their toll

Asian markets ended mostly lower today as the weak cues from the US markets and continued worries over the world economic conditions kept the buyers aside and investors booked profits after the latest gains. Dollar rallied in the Asian session, adding to the recent gains before giving up in late trades. Gold also struck fresh highs above $1400 an ounce as traders eyed resurfacing worries over the Eurozone PIIGS. The world's largest economies should consider gold as an indicator to help set foreign exchange rates, the head of the World Bank said on Monday, indicating that the world could be leaning towards a serious currency crisis. US stocks ended lower yesterday amid lack of major news. Dow closed down by 37.24 points or 0.3% to 11,406.84.



The Japanese market fell today, easing from a three month high as investors eyed the world economic worries resurface following the Eurozone jitters yesterday. Lack of major economic data and continued strength in the Japanese Yen also kept a tab on the activities. The benchmark Nikkei 225 index dropped 38.43 points or 0.39% to close at 9694.49 points.

The Australian stocks slide on selling pressure in resources after the latest set of gains. Banks also eased with Macquarie Group leading the losses. Traders feared of more tightening of credit in the economy after the Commonwealth Bank's chief executive, Sir Ralph Norris, stated that the recent interest rate hike announced by the Commonwealth Bank would be good for the economy. The benchmark S&P/ASX 200 fell 37.70 points or 0.79% to close at 4,741.

In China, stocks came off their recent highs after China's central bank raised the yield on the one-year bills it sold in its regular open market operation by more than five basis points, amid expectations that inflation continued to grow in October. Banks and property developers led the losses, after this move, which reflected that the country is on course to crack down further on hot money inflows into its economy. The benchmark Shanghai Composite Index gave up 24.51 points or 0.78% to close at 3,135 points.

The PBOC raised interest rates for the first time in nearly three years last month to temper inflationary pressures, lifting the one-year yuan-lending rate to 5.56% from 5.31%, and the one-year Yuan deposit rate to 2.5% from 2.25%.

In Mumbai, early losses were curbed and the key benchmark indices eked out decent gains in a choppy trading session tracking firm European stocks. Consumer durables, realty, FMCG and IT stocks rose. But, index heavyweight Reliance Industries edged lower in volatile trade. The market breadth was strong. State Bank of India slumped more than 4% after weak Q2 result. Capital goods stocks fell. The BSE 30-share Sensex was provisionally up 104.37 points or 0.5%, off close to 25 points from the day's high and up close to 195 points from the day's low.

In other markets, the Hang Seng index in Hong Kong lost 1.02%, the Straits Times index in Singapore edged up 0.40% while the TSEC index in Taiwan gave up 0.18%. The US dollar went up in the early Asian trades before giving up and was last seen quoting at 1.3911, after having traded as high as 1.3822 earlier in the day. Crude oil went up after early losses and tested its two-year high yet again, currently quoting at $87.51, up 45 cents from the previous close. Gold went up above $1420, topping a high of $1422.10 and currently trades at $1418, up $14.80 per ounce.