Asia watch

AN attack of vertigo struck Asian markets after recent rallies to their highest for two or three months. Overnight strength on Wall Street was ignored despite growing optimism about the outcome of the war in Afghanistan.

Even Japanese exporters, who have been recent big winners from the sagging yen, lost ground as investors pocketed profits. Tokyo's Nikkei Stock Average lost 44.39 points to 10,863.55, although this was well above its earlier low of 10,555. Sony and other electronics leaders, which had led a four-day bull run, slipped but the damage was limited by a firmer showing from the carmakers following record half-year profits from Nissan. The company's stock gained almost 4%.

Bank shares were back on the slide as nerves began to fray ahead of earnings reports this week that are likely to spring some nasty surprises in the level of debts and the fall in value of stock market investments.

Hong Kong investors shied at the Hang Seng's 11,400-point fence, and early gains were quickly reversed to leave the index down 134.5 points at 11,225.8. Telecom provider PCCW stood out with an advance of 7% after the group said it was making a further bond issue to raise between US$750m (£517m) and US$1bn in view of the good response to the first tranche.

It was programme-buying versus profit-taking in South Korean markets, and the profit-takers came out on top, the Kospi index losing 9.86 points to 616.57. More than a week of gains proved too much for Taiwan investors, and profit-taking took stocks back from a near three-month high. The Weighted Average dropped 89.09 points to 4459.54, led down by recent hi-tech fliers Taiwan Semiconductor and United Microelectronics.

Singapore stocks tested two-month highs before investors there also decided to take profits and cooled the market. After earlier cracking 1480 points, the Straits Times index settled at 1446.8, down 5.4 points. Overall sentiment was lifted by hopes of an early end to hostilities in central Asia but selective selling of recent winners such as Singapore Airlines and Creative Technology put the brakes on.

Old hands in Sydney were reminded of the Poseidon nickel-mining boom in the Sixties after shares in Tectonic Mining soared 32% on reports of a big metal strike in the Outback. More solid buying of other resource stocks and blue-chips on growing optimism about the economy lifted the S&P/ASX 200 index by 21.1 points to 3353, close to a three-month high. The All Ordinaries was up 85.7 at 3353. A 2% rise in News Corp took the stock to where it was before the terrorist attacks on the US as buyers moved in on hopes of a US recovery. The prospect of lower oil prices reducing Qantas's fuel bills boosted the shares 16 cents to A$2.27, close to a two-year peak.

The bulls trotted cautiously back into Malaysian markets after Monday's consolidation of recent gains and the Kuala Lumpur Composite index rallied 4.43 points to 632.57. Busy trading took Thailand's SET index up 3.41 points to 280.38 but Indonesian stocks drifted back, leaving the Jakarta Composite down 1.35 points to 381.44.

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.