Profit-takers thwart Japan intentions

PROMISES of urgent action to prop up

A more-buoyant overnight performance on Wall Street helped to overcome some pre-11 September anniversary jitters around the rest of the region.

Formerly sceptical investors now believe that the shock of the recent falls in Japanese share values to levels not seen for 19 years will stop the talk and start the action, which has been long promised but never delivered.

They were reassured by promises made by Prime Minister Junichiro Koizumi ahead of talks later this week with President George Bush. Koizumi said he intended to introduce urgent reforms to the tax and financial systems and act on badloan disposals in the fight against the country's chronic deflation. 'We will come up with a package of measures as soon as possible,' he said on board his flight to Boston.

Bank stocks rallied for a second day after a government panel recommended busted banks should be allowed to go to the wall, and called for the central bank to step in and buy bonds to help rebuild balance sheets. Mizuho Holdings, the world's largest bank, led gains with a rise of 3%, while other top lenders saw increases up to 2%.

A weakening of the yen, and a two-day rally on Wall Street has also lifted confidence that Japan's exporters will keep profits growing this year. Favourite stocks remained Sony Corporation, Toyota, Canon and Fuji Film. While Asian investors remained wary about the impact of an attack on Iraq, the opposition to any unilateral US action from other members of the United Nations, inspired some bargain-hunting among regional airlines' stocks. After taking a hammering in recent sessions, regional carriers showed sharp climbs today.

Singapore Airlines, the biggest operator in the region, rose almost 3% despite continuing concerns over the effect of rises in oil prices on its operating costs. New York's rally also encouraged buyers for other blue-chips in Singapore and the Straits Times index put on a useful 17.67 to 1441.56.

In Hong Kong, Cathay Pacific shares rose more than 4% as buyers judged that a long-term US recovery would more than offset any fuel cost rises, and provided the Hang Seng index with a 72.23-point gain to 9795.90.

After recent strong performances on the back of rising oil prices on world markets, Australia's resources stocks suffered a mixed morning's trading which left the All Ordinaries index down 7.7 points at 3061.6. Woodside Petroleum, which was sharply ahead yesterday, fell more than 1%, but BHP Billiton managed to add modestly to recent rises.

Good sales figures from Taiwan's computer- related companies took the Weighted Average up 97.22 to 4630.49, while a buyback of shares in Kookmin Bank lifted South Korea's Kospi 11.36 to 709.25. The Kuala Lumpur Composite rose 3.16 to 686.36 and Thailand's SET added 3.09 to 356.32. Jakarta's Composite eased 1.17 to 429.10.

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

709.25.

429.10.