Asia watch

TRADING screens in the East were red as investors backed away from equities, worried that recent signs of a US recovery would prove another false dawn.

Technology stocks were shunned following Nasdaq's overnight fall of 1.6% to below 2000 and ahead of key earnings figures from global chip leader Intel later this week that could put more question marks over the recovery story.

Recent euphoria over the outlook for Asian economies was also dampened by a warning from Morgan Stanley that any revival was likely to be anaemic compared with previous rebounds by Asian economies. Recent regional high-flier South Korea led the decline with a slump of 3.3%, while Tokyo and Hong Kong fell 1.7%.

Falls among stocks of big Japanese exporters took the Nikkei 225 Average down 233.54 to 10,208.05 at the close, and the more widely based Topix index dropped 14.82 points to 985.12, its lowest in more than three years. Stocks in companies which count on the US for their major revenues were among the worst hit, with consumer electronics giant Sony down almost 6%, while Canon, which gets 70% of its revenue from overseas, lost 2.6%. The most heavily traded stock was electronics giant Matsushita Electric, which shed almost 5%.

Banks slid after a major housebuilder filed for protection against bankruptcy on Monday when Tokyo markets were closed. This added to the concerns over the rapid climb in the debt mountain and underlined the rapid fall in domestic spending.

The potential for other Asia economies to return to tiger status was questioned by Morgan Stanley strategist Andy Xie who predicted that export growth in the region this year would be only 5.5% after last year's tumble of 11%. 'We expect GDP growth for the region ex-China will also be sub-par, at 2.5% for 2002 and 4.3% for 2003,' said Xie.

Stocks in Hong Kong fell across the board, and the Hang Seng index dived 195.8 points to 11,013.6, dragged down by telecoms companies, exporters and banks. US analysts' recent downgrading of telecoms stocks hammered China Mobile, the biggest mainland provider of cellphone services, which tumbled almost 3%. HSBC Holdings continued to suffer from earnings warnings, and fell HK$2 to HK$87.50.

The hardest falls in the region were suffered by South Korean technology stocks after Samsung Electronics failed to live up to earnings expectations, and the overnight fall on Nasdaq prompted profit-taking after recent strong gains. The Kospi index dived 25.48 points to 718.55, halving its year- to- date gain.

Taiwan retained some equilibrium as technology stocks avoided the worst of the regional sell-off, leaving the Weighted index down 19.12 points at 5592.74.

Export-dependent Singapore counters were carried down by a wave of selling in computer-related counters, and the Straits Times index lost 34.1 points at 1697.5.

Australian stocks hovered for much of the session before the Wall Street factor pulled the All Ordinaries index down 1.7 points to 3348.7, with News Corporation and resource stocks leading the way down. Malaysian and Indonesian stocks both climbed, the Kuala Lumpur up a modest 1.35 points to 699.8, and the Jakarta Composite 3.41 better at 419.25. Thailand's SET index drooped 2.09 to 323.57.

Prices and indices in this section are supplied from various sources and calculated at different times and may not always match those listed on the site.