Asian stocks close on modest gains

Stocks in the Philippines have been shaken by the kidnapping of 20 people by Muslim rebels

By Staff and wire reports

HONG KONG, China -- Asian markets rose Tuesday. But gains were cautious as investors looked to U.S. markets, reopening after the Memorial Day holiday.

Trading was light in Japan, where the benchmark Nikkei snapped a five-day losing streak to close up 0.3 percent at 13,773.89.

The broader, capital-weighted Topix index rose 0.4 percent to 1,355.63.

Banking stocks rebounded. They have been battered after Japan's eight big banking groups released earnings last week, revealing bigger problem loans.

Mizuho Holdings Inc., the world's largest bank by assets, gained 0.5 percent to 631,000 yen. It had lost 9.5 percent the previous two days.

Industry leader Mitsubishi Tokyo Financial Group gained 0.9 percent to 1.15 million yen. Sumitomo Mitsui rose 4.2 percent to 1,050 yen and UFJ Holdings Inc ended flat at 721,000 yen.

Investors suspicious about turnarounds

But traders said investors are increasingly suspicious about the recoveries many Japanese companies mapped out in their earnings announcements.

Most are basing their forecasts on a rebound in the second half of the fiscal year. But gloomy economic data suggest that is increasingly unlikely.

Tech stocks were looking to U.S. trade to restart. Chip stocks lost after a World Semiconductor Trade Statistics group report said the semiconductor market will likely shrink 13.5 percent in 2001.

Top chipmaker Toshiba Corp. fell 0.7 percent to 756 yen . Tokyo Electron Ltd., which makes chip-manufacturing equipment, slipped 0.3 percent to 8,910 yen.

Hong Kong, Australia off

Hong Kong was hit by selling in property and banking stocks following a sharp fall in mortgage loans last month.

The Hang Seng index ended the day down 0.8 percent at 13,629.61. Property stocks led the downdraft.

Bank HSBC Holdings, the Hang Seng's biggest component, slumped 0.5 percent to HK$98.25 on the bad mortgage data.

In Sydney, Australian stocks slipped further from record territory. The benchmark S&P/ASX 200 index ended down 0.3 percent at 3,411.1.

Investors had warned it was getting ahead of itself. It is now 0.9 percent below its May 25 record high of 3,444.3.

Qantas stock zoomed after it outlined a plan to shake up Asia-Pacific travel, with Air New Zealand and Singapore Airlines.

Qantas shares ended up 13 cents at A$3.48. The stock has now risen 29 percent over the month. It aims to buy a major stake in Air New Zealand, which would then likely sell Australia's second-largest carrier, Ansett, to Singapore Airlines.

Property developer Lend Lease dropped 6.2 percent to A$11.94, after the company warned on profits Monday.

Australia's big miners were also a drag on the market.

Philippine stocks drifted down 0.7 percent, with the Philippines composite index closing at 1,385.43. The abduction of 20 people by Abu Sayyaf rebels has shaken the markets and tourism there.

Seoul hits new high for year

In Seoul, stocks finished at a new high for the year. The Kospi closed up 2.2 percent at 632.05.

The market got a boost from General Motors, which has announced it is in formal negotiations to bid on bankrupt Daewoo Motors.

Samsung Electronics rose 4.3 percent to 232,000 won.

Taipei's benchmark Taiex index gained for the first time in three days. It lifted 0.3 percent to close at 5,095.26.

Investors were encouraged by stabilization in the Taiwan dollar. Computer exports gained as investors bet the currency's recent decline against the U.S. dollar would lead to better sales.

Reuters contributed to this report.

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