Tokyo weak, other markets higher


A Wall Street rise failed to lift the Tokyo market, which has been plagued by dismal corporate earnings

HONG KONG, China -- Tokyo shares slipped lower by midday Friday after bleak earnings reports chilled investor sentiment.

But other markets, including Hong Kong, Taiwan, Singapore and Korea, were off to a stronger start after Wall Street's better performance Thursday.

In Tokyo, the benchmark Nikkei 225 average ended the morning down 179.05 points or 1.79 percent at 9,818.75, while the broader capital-weighted TOPIX index fell 12.27 points or 1.26 percent to 959.50.

Disappointing earnings from tech giants such as NEC Corp and Pioneer Corp. weighed on investor sentiment. Big banks were also weaker on worries of a possible further downgrade in Japan's credit rating.

NEC fell 7.71 percent to 969 yen after the major chipmaker doubled its group net loss forecast for the year to March to 300 billion yen ($2.23 billion).

Pioneer dropped 13.58 percent at 2,545 yen after it reported an almost 50 percent plunge in group net profit for the latest quarter and cut its full-year earnings forecast.

The market was also dragged lower by worries that Prime Minister Junichiro Koizumi's reform campaign might lose momentum. Koizumi's approval rating slipped after his sacking of popular Foreign Minister Makiko Tanaka.

But major exporters such as automakers Toyota, Honda and Nissan were up on the weaker yen, as was consumer electronics leader Sony, which put on 70 yen to 5940 yen.

Strong start

In other markets, Seoul shares got off to a strong start buoyed by Wall Street gains and hopes for talks between memory chipmaker Hynix Semiconductor and Infineon Technologies AG.

The benchmark Kospi rose 1.73 percent to 761.01, while the over-the-counter Kosdaq was up 0.79 percent to 77.97.

Infineon's chief executive Ulrich Schmacher is to visit Seoul on Friday to discuss joining hands in chip production with Hynix, a source close to the talks told Reuters news agency.

Hynix rose 5.7 percent to 2,580 won. Rival Samsung Electronics rose 4.5 percent to 314,000 won.

The reported negotiations with Infineon come at a time when Hynix has been trying to sell its core memory chip operations to U.S. chipmaker Micron Technology.

Resources on the rise

The Australian market was modestly higher, boosted by sharp gains in the heavyweight resources stocks.

The benchmark S&P/ASX 200 index initially rallied to within a few points of its all-time high of 3,490.3, only to pull back to 3,472.2 for a gain of about 8 points.

Strong earnings posted on Thursday by resource giant Rio Tinto boosted shares 2.7 percent to A$39.35.

Rival BHP Billiton also rose 1.9 percent to A$11.39 supported by a rally in base metal prices overnight.

Lunar Holidays

Heavy selling in Taiwan stocks ahead of the long lunar holidays capped early gains as investors remain cautious over a weak economic rebound.

The benchmark Taiex share index was up 0.19 percent at 5,883.21.

In Singapore, the Straits Times index continues to track Wall Street's gains. It was up 0.79 percent at 1,801.04, pushed by banks and technology shares.

OCBC bank was up 1.55 percent at S$13.10, and Creative Technology gained 1.43 percent to S$28.30.

In Hong Kong, shares initially were also pushed higher by Wall Street's strong performance.

The Hang Seng index was up 0.23 percent at 10,749.52 by mid-morning, led by gains among heavyweights such as HSBC, China Mobile and China Unicom. Hutchison Whampoa was unchanged at HK$72.25.

However the index slipped marginally into the red close to midday.

News this week of an unexpected rise in U.S. gross domestic product in the final quarter of 2001, coupled with a surge in consumer confidence, pushed U.S. markets higher Thursday.

The Dow Jones Industrial average closed 1.61 percent higher at 9,920, while the tech-laden Nasdaq rose 1.08 percent to 1,934.1.