Asian stocks start week with modest losses

By staff and wire reports

HONG KONG, China -- Asian stocks couldn't sustain last week's gains, with the largest markets turning down on Monday.

Japan, Australia and Hong Kong all ended with losses. Taiwan saw a particularly sharp decline of more than 2 percent, and South Korea also fell.

Singapore was one of the few Asian markets that finished in the black, up 0.3 percent.

The modest Asian selloff followed through on a 0.7 percent drop in the Dow Jones industrial average on Friday.

Asian investors are still trading with one eye on U.S. prospects. Technology stocks got little joy out of Nasdaq's modest 0.1 percent gain to end the week.

Advantest tests Nikkei gains

In Japan, the benchmark Nikkei 225 index fell 1.7 percent to end at 10,452.54. The broader Topix index showed a similar drop, ending down 1.4 percent at 1,071.78.

Chip-testing device maker Advantest shook the market, its stock tumbling 10.18 percent to 6,000 yen. That accounted for 17 percent of the Nikkei's drop.

Advantest said late Friday it expects a group net loss of five billion yen ($41.30 million) for the year through March, down from a previously forecast four billion yen profit.

Matsushita Electric Industrial Co Ltd., the world's largest consumer electronics maker, slipped 3.87 percent to 1,516 yen after also cutting its earnings forecast on Friday.

Trading was light, after investors said they saw traders covering short positions in last week's Nikkei runup. It gained 6.7 percent on Thursday and Friday, pushing it well above Sept. 11 levels.

But car makers are still suffering from the uncertain effects of the attacks. Toyota Motor Corp, Japan's largest automaker, gave up 2.46 percent to 3,170 yen.

Japan's car companies look to the United States for much of their exports. No. 2 Nissan Motor Co. shed 6.13 percent to 582.

The Bank of Japan on Monday downgraded its view on the economy for a fifth straight month, citing a hefty drop in output and rising uncertainty after the attacks.

Japan also posted a 27 percent decline in its current-account surplus, as both exports and imports slowed.

News leads Sydney back down

In Australia, the benchmark S&P/ASX 200 index finished a subdued session down 26.1 points or 0.8 percent at 3,199.0.

It is one of the few Asia-Pacific indexes that has yet to close above its Sept. 11 level, though it touched it during the day Friday.

News Corp., which is Sydney's biggest stock and has close to a 10 percent weighting in the index, ended down 3.3 percent at A$13.85.

It rose 12 percent last week, but doubts about News, which gets 70 percent of its revenues in the United States, crept back in after last week's reassurances from chairman Rupert Murdoch.

Australia's biggest grocer, Woolworths, dropped 0.8 percent to A$11.69 despite strong full-year earnings growth, with some investors continuing to switch to rival Coles.

Miner WMC rose three percent to A$8.70, adding to Friday's 8.6 percent gain. There is speculation Alcoa will soon launch a takeover bid at around A$9.50 a share.

Most major miners lost ground, though, with Rio Tinto down 1.8 percent and BHP Billiton off 1.2 percent.

In Wellington, the benchmark NZSE-40 capital index rose 0.4 percent to 1,910.01. Air New Zealand's B shares, open to overseas investors, rose 2 cents to NZ$0.29 after the embattled airline said it had reached a deal with financial backers.

Hong Kong's recent gainers lose ground

Hong Kong's benchmark Hang Seng index dropped 1.4 percent to close at 10,130.59. The losses were led by two stocks that have gained strongly since the Sept. 11 attacks.

Legend Holdings, the largest computer company in mainland China, fell 7.7 percent to HK$3.30. But it had risen 5.5 percent since the attacks.

Likewise, China Mobile, the mainland's biggest cell-phone company, fell 3.65 percent to HK$23.65. It had risen 10 percent since Sept. 11.

There's speculation investment house China Everbright is putting some of its China Mobile stake on the market.

South Korea's Kospi index closed off 0.47 percent at 513.99. Seoul's largest listing, Samsung Electronics, fell 1.8 percent to 160,000 won.

Traders said investors seemed to be locking in profits after recent gains.

In Taiwan, the benchmark Taiex fell 2.3 percent to 3,712.82. That broke three days of gains.

China Airlines, Taiwan's largest airline, fell 5.3 percent to T$9.85 after slashing its profit forecast on Friday because of the terror attacks.

Investors said the direction of Taiwan's markets would largely be determined by U.S. stocks in the near term.

In Singapore, the benchmark Straits Times index closed up 4.54 points or 0.32 percent at 1,420.78, though technology stocks did not perform well.

Reuters contributed to this report.