Asia watch

THE Enron effect, fallout from Argentina's debt woes and doubts about the US economy ahead of a batch of key indicators pummelled Asia's major markets.

Japanese banks were toppled by bad debt problems, and dragged the Nikkei 225 Average down more than 2% in morning trade. It carried on down to a day's loss of more than 3%, a fall of 362.82 points to 10,370.62.

Assurances from the head of Japan's Financial Services Agency, Shoji Mori, that big Japanese banks were not heavily exposed to Enron, US largest bankruptcy so far, failed to stop investors dumping stock on their bad debt problems. Mori added to the nervousness among smaller banks by warning that a government-backed guarantee scheme expires at the end of the year. He said it should not be renewed, whatever the cost.

Japan's sixth-biggest bank, UJF, swooned almost 8% after Mori's statement, and was further weakened by its asset management arm's holding of Enron bonds. The country's two largest banks, Mizuho Holdings and Sumitomo Mitsui, tumbled more than 4%.

Shares in advertising giant Dentsu recovered from the chaotic opening trade on Friday caused by a mis-keying of a sell order by UBS Warburg. The European brokerage now faces an estimated US$100m (£70m) bill for buying back in for delivery around 65,000 of the 610,000 shares that were mistakenly offered for sale.

Figures released on Friday which showed Hong Kong's economy grew 0.4% in the third quarter and so had not followed Japan, Singapore and Taiwan into recession failed to stem a fall in the Hang Seng, which tumbled 124.1 to 11,155.2.

The relatively heavy exposure to Argentine-debt by HSBC Holdings made it the sell of the day in Hong Kong, and the stock lost HK$1.75 to HK$92.75. New entrants admitted to the Morgan Stanley Capital Index series at the weekend fell on profit-taking following a mild run-up ahead of the well-telegraphed changes.

Taiwan stocks stood out with a 4% leap, after the weekend's election results which put power firmly into the hands of the Democratic Progressive Party. Although the win raised fears of more problems with Beijing over Taiwan's independence claims, the prospects of local stability inspired investors and the Weighted Average galloped up 202.32 points to 4643.44.

South Korean stocks were quiet after the strong rally last month, and the Kospi edged up a point to 644.89. An 8% fall in Singapore Airlines passenger load factor last month, which reflected the slump in business after 11 September, failed to hurt the shares, which climbed 4%, carrying the Straits Times index up 14.8 to 1493.3.

Global economy worries overcame bullish retail sales figures in Sydney. The All Ordinaries gained 51.9 to 3328.8, amid data showing sales were up a better-than-expected 1.3% last month, promising a bright Christmas for retailers.

Investors swooped on Telkom Malaysia shares, judging recent falls to be overdone, and this pushed the Kuala Lumpur Composite index up 4.04 points to 642.06. In Indonesia the Jakarta Composite mildly improved on Friday's rally with a 0.84-point gain to 381.15, while Thailand's SET edged up 0.99 points to 303.61.

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.