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Asian markets lower as dealers await US jobs data

In Uncategorized on June 4, 2010 at 10:13 am

HONG KONG (AFP) – Asian shares fell in quiet trade on Friday with Japanese investors unmoved by the election of a new prime minister while most dealers stayed on the sidelines ahead of key US jobs figures.

Asian shares have fallen in quiet trade with Japanese investors unmoved by the election of a new prime minister (AFP file)

Tokyo’s Nikkei fell and the yen edged lower after former finance minister Naoto Kan, a supporter of a weaker currency and proponent of deflation-fighting measures, was confirmed as the country’s new leader.

Japanese shares closed 0.13 percent, or 13 points, lower at 9,901.19 after Kan succeeded Yukio Hatoyama, who resigned Wednesday over the bungled handling of a US base dispute.

The index had already soared 3.24 percent Thursday, with dealers pricing in expectations that Kan would take the helm of the world’s second biggest economy.

Despite his preference for a weaker yen, which would be good for the country’s key exporters, dealers stuck with the safe-haven unit due to lingering fears over Europe’s debt problems.

The dollar edged up to 92.73 yen in late Tokyo trade, from 92.69 in New York Thursday. The euro rose to 112.88 yen from 112.74 and to 1.2179 dollars from 1.2158.

Analysts had predicted the dollar could pass 93 yen if Kan was elected prime minister. But Mizuho Securities strategist Tsuyoshi Segawa told Dow Jones Newswires: “It is still hard to say if the market really wants ‘DPJ victory-inspired stability’ in the upcoming election.”

Japan will hold upper house elections next month where the Democratic Party of Japan must win a majority to free itself of its coalition partner and ensure a smooth enactment of legislature.

Sydney fell 0.82 percent, or 36.6 points, to 4,449.4. Hong Kong lost 0.30 percent by the break and Singapore was flat.

Dealers moved to sell off and take the cash after Thursday’s rallies, which were boosted by strong US housing data.

Markets were given a weaker lead from Wall Street Friday as the Dow edged up just 0.06 percent after a mixed batch of news showing a weekly drop in initial unemployment claims and a disappointing report on private-sector job creation.

However, focus was on a US Labor Department report due later Friday that will reveal job creation and unemployment figures for May, giving a much clearer idea of the state of recovery in the world’s biggest economy.

Most analysts expect the government will report 500,000 non-farm jobs were created last month, up from 290,000 in April, as the economy mounts a slow recovery from recession.

Unemployment was expected to dip to 9.8 percent from 9.9 percent in April.

Shanghai gave up 0.49 percent, with heavyweight banks leading the fall amid pressures over the imminent launch of Agricultural Bank’s massive initial public offering, dealers said. Many fear the issue could dilute the market, putting pressure on prices.

European Commission President Jose Manuel Barroso on Thursday warned Hungary to cut its budget deficit faster in order to pull itself out of a “delicate situation” amid fears it risked a Greek-like debt crisis.

Oil was lower. New York’s main contract, light sweet crude for delivery in July shed 29 cents to 74.32 dollars a barrel while Brent North Sea crude for July dropped 31 cents to 75.10 dollars per barrel.

Gold opened at 1,206.00-1,207.00 US dollars an ounce in Hong Kong, down from Thursday’s close of 1,223.00-1,224.00 dollars.

In other markets:

— Seoul closed 0.14 percent, or 2.29 points, higher at 1,664.13.

— Taipei fell 0.21 percent, or 15.69 points, to 7,344.59.

IT giant Hon Hai was 0.8 percent lower at 124.5 Taiwan dollars while Taiwan Semiconductor Manufacturing Company rose 0.33 percent to 61.0

— Manila closed flat, edging up 1.82 points to 3,357.05.

SM Prime Holdings was unchanged at 11.00 pesos, Banco de Oro Unibank fell 1.0 percent to 46.00 and Ayala Corp was off 2.9 percent at 325.00.

— Wellington added 0.20 percent, or 6.04 points, to close at 3,030.14.

Telecom led the market higher, gaining 1.6 percent to 1.86 New Zealand dollars, but exchange operator NZX ended down 1.9 percent at 1.55.

Source: SGGP

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