Stocks fight back after tech rout

ASIAN stock markets fought back from heavy early falls today after Wall Street and Nasdaq continued to slide in New York. After battering technology stocks, investors suddenly stepped back in to pick up bargains uncovered by the recent rapid ebbing of market valuations.

Gloomy forecasts from US analysts on the outlook for computer and component sales caused technology stocks in the region to be hammered as markets opened.

In Tokyo, the Nikkei 225 Average sank to 10,495.00 but a late burst of buying, and further short-covering which had rescued the market from disaster yesterday, took it back to 10,812.3 for a net gain of 189.98 points at the close.

A similar turnaround lifted Taiwan's tech-heavy market by 41.44 points to 5036.52, after an initial plunge to 4808.0. The recovery came despite warnings from Morgan Stanley and Salomon Smith Barney that the demand for computers and chips would remain thin. Although chip stocks remained weak in Tokyo, domestic old-economy counters undid the damage. Bank shares firmed after reports that the government was prepared to put more public money into their rickety balance sheets.

Stores group Fast Retailing, which runs the Uniqlo brand that is expanding in Britain, surged 4% as investors bet that the slide in its domestic sales could go no lower. Sales in Japan fell 33% last month following a 44% decline in May.

Some late-morning buying of property stocks in Hong Kong resulted in the Hang Seng index shrugging off early Wall Street-induced blues, and it ended the morning with a net gain of 58.08 points at 10,549.84. Good sales of the latest tranche of the tracker fund set up to dispose of shares purchased by the Hong Kong government during the Asian economic crisis also calmed nerves.

After three consecutive days of gains, South Korean stocks looked set to dive into the red from the opening bell but investors returned in late morning. After hitting 733.6, the Kospi index recovered to 755.8 points, a a net gain of 9.57. Hynix Semiconductor surged 14% after bank creditors of the debt-laden group took control of the board, raising hopes of a sale of the company's major assets. Initial falls in Singapore's blue-chips were quickly reversed, and the Straits Times index put on 22.83 points to 1575.56.

Australian stocks received no help from bouncy retail sales figures and the Reserve Bank's no-change decision on interest rates, and the All Ordinaries index drooped 26.3 points to 3132.9. News Corporation shares continued to dive as investors ignored the group's strong fundamentals and worried about the growing global accounting scandals, and the media giant's stock dropped 5% to a new three-and-a-half year low.

Malaysian stocks fell more than 1% in line with Wall Street, and received no support from assurances by Prime Minister Mahathir Mohamad that he would ensure an orderly handover of power. The Kuala Lumpur Composite index lost 9.15 points at 734.21. Thailand's SET index advanced 2.99 points to 393.77 on selective buying but Indonesian stocks continued to retreat and the Jakarta Composite index dipped 2.32 points to 481.46.

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.