Asian stocks mixed as traders stay edgy after rate cuts

Asian stocks were mixed Thursday as investors remained cautious about the global economy after a series of interest rate cuts by some of the world's major central banks tried to revive confidence.
Hong Kong, South Korea and Taiwan all reduced borrowing costs, a day after central banks in the United States, Canada and Europe announced simultaneous cuts, followed soon afterwards by China.
Tokyo slipped 0.5 percent -- to a five-year low -- following a rollercoaster session a day the index slipped more than nine percent, its worst single day drop in 21 years.
Sydney lost 1.5 percent, Taipei shed 1.45 percent and Shanghai was almost one percent off. However, traders in Hong Kong took heart from the rate cuts with the Hang Seng Index rising 3.3 percent a day after plunging 8.2 percent, while Singapore added 3.4 percent.
Seoul was also boosted, rising 0.6 percent.
Earlier in the day Taiwan and South Korea cut their rates by 25 basis points, while Hong Kong took another 0.5 percentage point off its lending costs. China made a 27 basis point reduction Wednesday. Australia's central bank cut its rate by one percentage point on Tuesday in a bid to put ease the worst global financial crisis since the Great Depression.
"While rate cuts may not address the root cause of the problem, they do help the real economy and indirectly assist bank recapitalisation," said analysts at UBS.
Although the Bank of Japan did not lower its interest rates -- already at just 0.5 percent -- it did inject 4.0 trillion yen (40 billion dollars) into the market, the biggest one-day injection since the crisis began.
Fears that Japan is on the brink of recession were raised also, when figures showed core machinery orders, a key gauge of corporate capital spending, slumped 14.5 percent in August from the previous month.
The figure represents the fastest drop in more than two years.
In Hong Kong, although the market saw a healthy rise on the back of the rate cuts, volume was light, suggesting confidence is still at a premium.
World markets have been plummeting in recent weeks following the collapse of US investment bank Lehman Brothers and the government bailout of insurer AIG.
A 700 billion dollar rescue package for the ailing US financial system agreed by lawmakers in Washington last week failed to lift investors despite.
Elsewhere Wellington was 0.13 percent lower, Manila lost 0.8 percent, while Kuala Lumpur was flat and Bangkok firmed by 1.55 percent.
Jakarta was closed for a second day after the market shed more than 10 percent in trading on Thursday.
Mumbai was closed for a public holiday.
TOKYO: Japanese shares ended 0.5 percent lower, dealers said.
Stocks slipped in and out of positive territory a day after their biggest loss in two decades, with the benchmark Nikkei stock index finishing down 45.83 points at 9,157.49.
The Topix index of all first section shares climbed 6.10 points, or 0.68 percent, to end at 905.11.
Investors were also worried about upcoming earning reports from Japanese companies, which are likely to show the effects of a weaker global economy and stronger yen.
Aeon shares plunged 11 percent to 850 yen after the supermarket operator reported a fiscal first half net loss of 16.01 billion yen, compared with a year-earlier profit of 23.81 billion yen.
Sumitomo Mitsui Financial advanced 7.5 percent to 601,000 yen and Mizuho Financial Group climbed 3.6 percent to 374,000 yen.
HONG KONG: Hong Kong share prices closed 3.3 percent higher, dealers said.
The benchmark Hang Seng Index closed up 511.51 points at 15,943.24, after falling more than eight percent Wednesday.
Dealers said they do not expect the rally to persist as confidence is still fragile and weak US markets will weigh on sentiment.
Peter Lai, director at DBS Vickers Securities, said he expects the Hang Seng Index to find near-term support at 14,800-15,000.
The China Enterprises Index, which tracks the movement of China-registered companies traded in Hong Kong, jumped 3.9 percent to 7,743.47, after the People's Bank of China cut its benchmark interest rates.
China Construction Bank rose 4.1 percent to 4.06 Hong Kong dollars, ICBC advanced 6.6 percent to 4.05, and Bank of China surged 5.4 percent to 2.73.
SYDNEY: Australian shares closed down 1.5 percent, dealers said.
The benchmark S&P/ASX200 fell 67.2 points to 4320.9, while the broader All Ordinaries lost 78.5 points at 4291.3.
A total of 1.6 billion shares valued at 5.6 billion dollars (3.8 billion US) changed hands, with 308 stocks up 840 down and 296 flat.
Energy stocks dragged the market down on lower crude oil prices while Commonwealth Bank alone accounted for 15 points of the fall.
The bank fell 6.1 percent to 42.40 dollars after issuing 2.0 billion dollars worth of shares at 38.00 dollars to fund its acquisition of BankWest from troubled British lender HBOS.
ANZ lost 35 cents or 2.06 percent to 16.65, National Australia Bank fell 62 cents or 2.55 percent to 23.73 and Westpac was off 17 cents or 0.78 percent to 21.50.
BHP Billiton lost six cents to 29.84 and rival Rio Tinto fell 3.11 or 3.83 percent to 78.01.
SHANGHAI: Chinese share prices closed down 0.84 percent, dealers said.
Shares rose at the opening bell in reaction to the rate cut, but only lasted half an hour before sinking to the negative territory. It rose again by midday, but resumed the downside in the afternoon.
The benchmark Shanghai Composite Index, which covers A and B shares, was down 17.64 points at 2,074.58 on turnover of 35.9 billion yuan (5.3 billion dollars).
Bank of Communications fell 1.9 percent to 5.15 yuan, while China Construction Bank dropped 0.5 percent to 4.21 yuan.
Property developers were also sharply lower.
China Vanke, the country's top property developer by market value, lost 3.9 percent to 6.25 yuan.
Poly Real Estate slumped 7.9 percent to 13.89 yuan and China Merchants Property Development shed 2.2 percent to 12.90 yuan.
The Shanghai A-share index fell 0.84 percent to 2,178.79 points, while the Shenzhen A-share index was down 1.43 percent at 591.12.
TAIPEI: Taiwan shares closed down 1.45 percent, dealers said.
The weighted index fell 75.69 points to 5,130.71, off a high of 5,295.05, on turnover of 74.82 billion Taiwan dollars (2.31 billion US).
Losers led gainers by 1,133 to 432 with 349 stocks unchanged.
After opening lower, the market turned higher as the central bank announced to cut three key interest rates by 25 basis points. However, the index headed south on profit-taking after it moved closer to 5,300 points.
Asustek fell 5.65 percent to 50.10 dollars, AU Optronics shed 5.07 percent to 30.90 and Chi Mei Optoelectronics was 1.81 percent lower at 18.95.
Taiwan Semiconductor Manufacturing Co. lost 0.32 percent to 46.10, while United Microelectronics Corp. gained 0.91 percent to 10.00.
Fubon Financial lost 0.54 percent to 18.50, while Cathay Financial rose 3.16 percent to 37.60.
SEOUL: South Korean shares closed 0.6 percent higher, dealers said.
The KOSPI index ended up 8.20 points at 1,294.89.
Analysts said the Bank of Korea's rate cut helped to give the market a break but may not be material in terms of reversing the overall downward trend.
"Today's rate cut was like a morphine shot," Lee Jae-Hoon, an analyst at Mirae Asset Securities, told Dow Jones Newswires.
Shares of construction and financial firms rose. Hyundai Engineering and Construction gained 6.7 percent to 66,500 won.
Shinhan Financial Group added 3.9 percent to 37,000 and Samsung Electronics rose 2.5 percent to 541,000.
Samsung Heavy Industries fell 4.4 percent to 22,750 won. Hyundai Heavy Industries lost 0.93 percent to 212,500.
SINGAPORE: Shares bounced back to close 3.40 percent higher, dealers said.