Prowling bears pull down markets

ASIAN bears were on the prowl today and found plenty to feed on as rising Middle East tensions, Wall Street's weakness and concerns over the global economic recovery continued to push markets down to recent lows.

Japan's Nikkei 225 Average plunged 258.63 points to close at 10,354.35. Former technology favourites in South Korea continued to be shunned by foreign investors and Hong Kong's blue-chips followed Wall Street's overnight slump of 1.4%. After being lifted by signs of an export-led recovery yesterday, Tokyo stocks were slapped down again by fresh indicators that pointed to a relapse by the fragile economy.

The all-industries index, a major indicator of economic activity, showed a 1.5% fall in April as construction and services continued to stagnate. A 1.3% rise in March had raised hopes that a general revival in Japan Inc was under way. The continued weakness of the US dollar against the yen fuelled fears that May's 8.8% jump in exports would be a short-lived affair as the competitive edge of motor and consumer electronics manufacturers was blunted.

Hong Kong's Hang Seng index revisited levels last seen in mid-April as it lost 129.18 points to 10,625.23. Leading mobile phones group China Unicom sank to record lows following a downgrading by Goldman Sachs, and reports of poor handset sales, while investors avoided other blue-chips ahead of a planned sale of stock in the Bank of China group early next month.

HSBC Holdings remained the whipping boy for the uncertainties over the US economy, falling HK$1 to HK$88.75. The US government's anti-trust probe into microchip manufacturers continued to depress big suppliers from South Korea and Taiwan.

Samsung denied involvement but its shares tumbled 2%, and widespread weakness elsewhere in the sector pulled Seoul's Kospi index back to a four-month low of

769.67 before some late bottom-fishing saw it recover to 778.02, up 1.21.

Taiwan stocks rallied despite a 2.5% slide in shares in Nanya Technologies after the group revealed it had been summoned to give evidence. The market rebounded after early falls due to some support for financial stocks from government-linked funds. The Weighted Average gained a net 47.18 points to 5492.95. The dull prospects for PC sales weighed down on shares of Singapore's component suppliers and the Straits Times index lost 23.75 points at 1550.55.

Global gloom sent Sydney stocks down to seven-month lows, as News Corp shares dived almost 3% to levels last seen in October 1999. Gold shares moved ahead after a sharp overnight rise in the bullion price reflected growing world tensions, but other resource stocks were mixed and the All Ordinaries index tumbled 33.9 points to 3196.8. Shares in insurance giant AMP began to level out as investors welcomed tough action on costs, including the axeing of 1500 workers in Britain.

Economic uncertainties left Malaysian stocks floundering and the Kuala Lumpur Composite index lost 1.62 points at 744.65.

In Thailand, stocks stayed out of favour with overseas investors and the SET index fell 9.07 points to 394.24. Indonesia's Jakarta Composite index fell by 2.45 points to 527.55.

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.