Asia Watch

ASIAN investors were staring into their teacups, wondering whether US Federal Reserve chairman Alan Greenspan had declared them half full or half empty.

After Greenspan's remarks about the US economy shook Wall Street and Nasdaq, regional investors spent the weekend dissecting his views. They liked his statement that the long-term future looked bright, but were less sure about his emphasis on short-term risks and his conclusion that it was too soon to say if a real recovery was underway. The pessimistic reaction was softened by the possibility that the Fed's year-long round of interest rate cuts may not be over.

With Tokyo closed for a public holiday, it was left to Hong Kong to set the pace, but investors did not know which way to jump, and after a mixed morning's trading the Hang Seng index had slipped 10.89 points to 11,155.57.

The main drag on the market was HSBC Holdings, which dropped below HK$90 after Morgan Stanley Dean Witter warned that earnings this year were likely to decline by 5%. The bank's Argentine bad debt experience could be worse than most analysts expect, said Morgan Stanley, while lending was likely to be sluggish. Morgan Stanley maintained its target price for HSBC at HK$91, but the stock fell HK$2 to HK$89.

The damage to the broader market was limited by a rally in the shares of mainland cellphone operators China Mobile and China Unicom, which both recovered recent losses caused by an apparent change of competition policy in Beijing.

The bears were in command in Taiwan, where the prospects of a slow return to recovery in the US hit recently strong technology stocks. Led down by chipmakers, which lost more than 1%, the Weighted Average fell 75.73 points to 5611.86.

Foreign buyers of South Korean stocks remained more sanguine about the long-term prospects for the economy, which is much less dependent on the narrow semiconductor sector than Taiwan. Last week's profit-taking ended as overseas institutions moved back in and the Kospi became the top regional performer with a gain of more than 2%. Early losses were soon replaced by strong gains among local telecom plays and chipmakers, and the index climbed 15.59 points to 742.95.

Early profit-taking in Singapore was soon replaced by bargain hunting which took the Straits Times index up 3.52 points to 1707.59. The most dramatic rebound was among tech stocks, which recovered from early losses of up to 5% after Friday's poor performance on Nasdaq .

Australian investors did not like Greenspan's view of short-term prospects, and dumped News Corporation stocks on fears for its US earnings. Banks stocks also weakened, putting more pressure on the All Ordinaries index which fell 9.7 points to 3350.4.

A warning by Malaysian Prime Minister Mahathir Mohamad that the yen's fall might force a rethink on the local currency's peg to the US dollar unsettled stocks in Kuala Lumpur, and the Composite index fell 2.74 points to 700.3.

Stocks in Thailand and Indonesia staged modest advances, Bangkok's SET index up 3.17 to 325.72 and Jakarta's Composite index 1.18 points better at 412.95.

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.