Asian Markets Rebound After Falling On Wall St Lead
Asian markets were mixed Wednesday, recovering from earlier losses sparked by a fall on Wall Street and concerns about Italy's finances which stoked fresh fears about the Eurozone.
Stocks had also been pushed lower by the prospect that Germany may delay the launch of a permanent bailout fund for the Eurozone. The euro held steady in Asian trade.
Tokyo closed flat, edging down 0.08 percent, or 6.73 points, to end at 8,851.00, while Sydney lost 0.04 percent, or 1.52 points, to finish at 4,096.50 points.
Hong Kong put on 0.12 percent, or 23.51 points, to finish at 19,419.87, while Shanghai ended up 0.51 percent, or 10.94 points, at 2,175.38.
Seoul lost 0.17 percent, or 3.06 points, to close at 1,826.39.
U.S. stocks closed sharply lower on Tuesday on concerns over American corporate earnings and a slump in confidence registered by a U.S. small-business survey.
The Dow Jones Industrial Average dropped 0.65 percent, while The S&P 500 fell 0.81 percent and the tech-rich Nasdaq slipped 1.00 percent.
In Europe, this week's deal to help crisis-hit Spain was quickly overshadowed by concerns that Italy, also struggling with enormous debts, may have to tap a regional rescue fund.
At the end of a Eurozone meeting in Brussels, Italian Prime Minister Mario Monti said Rome may one day ask for the Eurozone rescue fund to intervene in the bond market in order to ease his country's borrowing costs.
"It is very difficult to say that Italy will never need help from one fund or another and caution compels me not to talk about such things," Monti said, after previously insisting that Rome did not need such an intervention.
Meanwhile fears grew that the German constitutional court may delay ratification of the Eurozone’s permanent bailout fund, which is to be used to recapitalize Spanish banks.
The court was expected to rule by the end of the month whether the president should be permitted under constitutional law to sign the legislation, but has hinted at a possible further delay.
Investors were skeptical about the deal to help Spain, also announced in Brussels, which will channel 30 billion euros ($37 billion) this month to its banks and give Madrid an extension to a deadline to cut its public deficit.
"There is a broad framework to deal with the crisis, but uncertainty remains over whether it will work," said Kenichi Hirano, operating officer at Tachibana Securities.
"Participants will likely maintain their wait-and-see approach over the European situation."
On currency markets, the euro bought $1.2263 and 97.34 yen in Tokyo afternoon trade, from $1.2251 and 97.26 yen in New York late Tuesday.
The dollar weakened to 79.35 yen from 79.41 yen amid speculation that the Bank of Japan, which started a two-day policy meeting Wednesday, will usher in further easing measures to power the world's third-largest economy.
Concerns about China also weighed on markets as investors awaited more key data later in the week, including second-quarter GDP, to gauge how fast the world's second-largest economy is slowing.
Dealers were also looking to the release of minutes from a U.S. Federal Reserve meeting due Thursday.
On oil markets, New York's main contract, light sweet crude for August delivery, gained 64 cents to $84.55 a barrel in the afternoon and Brent North Sea crude for delivery in August rose 50 cents to $98.47.
Gold was worth $1,576.65 an ounce at 0830 GMT, compared with $1,593.10 late Tuesday.
On other markets:
-- Taipei rose 0.09 percent, or 6.56 points, to 7,257.91.
Smartphone maker HTC gained 2.62 percent to Tw$313.0 while Taiwan Semiconductor Manufacturing Co. closed 1.26 percent lower at Tw$78.1.
-- Wellington rose 0.41 percent, or 14.12 points, to 3,478.84.
Telecom Corp. was up 1.0 percent at NZ$2.525, Chorus rose 0.2 percent to NZ$3.27 and Fletcher Building was down 0.60 percent at NZ$6.09.
-- Manila closed 0.09 percent, or 4.84 points, lower at 5,235.44.
Ayala Land Inc. dropped 1.9 percent to 20.65 pesos while Philippine Long Distance Telephone fell 1.46 percent to 2,706 pesos.