Wal-Mart sends Tokyo into spin

MAYHEM in stores stocks in Tokyo largely offset strong gains in exporters after better employment numbers for the US overnight were taken as another plus point for consumer spending.

Other Asian markets were mixed, and technology stocks were nervous after the Oracle database software giant reported disappointing third-quarter earnings in the US, with soft sales in Asia taking some of the blame.

Shares of the Seiyu stores group soared 21%, after gaining 28% after Wal-Mart, the world's largest retailer, picked up a 6.1% stake in the Japanese supermarkets chain. The prospect of a powerful new force in Japan's antiquated retail sector caused dismay among investors in rival stores.

Shares in Ito-Yokado, Japan's largest retailer, slumped by more than 3%, while Jusco supermarkets operator Aeon dived 3.2%. The falls watered down the effect of strong gains by exporters whose fortunes are linked to the US consumer, and the Nikkei 225 ended a see-saw session up 79.19 points at 11,648.01. Stock exchange figures showed net purchases of 770bn yen (£4.2bn), the second-highest figure since the record 776 billion yen of March 1999.

Turnover in Hong Kong stocks slumped as caution gripped investors ahead of an upcoming season of blue-chip company results. The Hang Seng index fell 75.29 points to 11,228.41, as Citic Pacific, a locally quoted mainland conglomerate, fell almost 3% after disappointing analysts with a 36% fall in 2001 earnings.

Further damage was done by a 9.9% crash in the price of China Everbright after it warned that profits from its mainland financial services business would be below expectations. In Taiwan, gloom over Oracle's 13% decline in third-quarter earnings was compounded by the impending sale by the government's stabilisation fund of a 2% stake in United Microelectronics. UMC shares tumbled almost 4% on the news, and the Weighted Average index slid 119.05 points to 5951.45.

Chip shares in South Korea also weakened. Samsung Electronics lost 3.5% after prices of D-ram chips slipped overnight, while Hynix Semiconductor weakened as investors waited to see if creditor banks would back a support operations which would open the way for the US Micron giant to take a stake in the ailing Korean firm. The Kospi index struggled up 3.5 points to 860.36.

Singapore bank stocks firmed as the suspension of shares in UOB Bank led to speculation that a round of consolidation was on the way, and the Straits Times index edged up 2.23 points to 1780.

Growing conviction that Australia's central bank will raise interest rates later this year as the economy continues to power ahead continued to dull trade in Sydney, where the All Ordinaries index slipped 41.3 points to 3356.7. News Corporation shares led the market lower, while resource stocks also faded despite recent signs of an upward trend in global commodity prices.

Thailand's ST index drifted down 3.54 points to 378.62, while in Indonesia the Jakarta Composite index lost 6.01 to 467.99, and Malaysia's Composite index in Kuala Lumpur was down 2.87 points to 751.64.