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Tokyo dips, Korea soars
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December 10, 1998: 6:38 a.m. ET
Nikkei loses 124 points, Hong Kong sheds 45 but Korea jumps 7.8 percent
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LONDON (CNNfn) - Tokyo stocks fell nearly 1 percent Thursday after three days of gains. But Korea soared again, closing almost 8 percent higher as overseas buyers continued to snap up stocks.
Other Asian markets were mostly positive on the back of better performances on Wall Street and in Europe.
Australia climbed 0.5 percent with the Philippines adding 3 percent by its close.
Malaysia and Indonesia both ended up about 1 percent while Thailand was closed. Taiwan slipped 1 percent.
Korea shone, climbing 7.8 percent in record volume. Analysts pointed to continued fallout from widespread corporate restructuring announced by the country's chaebol conglomerates earlier in the week.
"Everybody has just turned very positive and a lot of retail investors jumped into the market," said one analyst at a European brokerage in Seoul.
Tokyo stocks finished an up and down day off 0.83 percent or 124.1 points at 14,807.80.
Traders were nervous ahead of Friday's "special quotation" settlement for December futures and options contracts. But it was more bad news on the economy that sent the market lower.
"The decline seemed to kick in around the time of publication of data on machinery orders which is a key indicator of capital expenditure," said Lehman Brothers chief economist Russell Jones. "It was well below forecast, down 12.5 percent on the month."
It was the third piece of bad news on the economy in as many days. Earlier in the week a quarterly finance ministry survey had revealed plunging business confidence.
Then after the market close Wednesday, the Bank of Japan said bank lending had posted a record decline in November.
But that at least was good news for bank stocks, according to ING Barings banks analyst James Fiorillo.
"Banks ... are likely to continue reducing the size of their loan portfolios," he said. "This should be regarded by investors as good news, so in this case, fewer loans makes more sense.
Banks did well on the day. Sanwa Bank climbed almost 1 percent to 1,110 yen, as the sector as a whole rose 0.28 percent.
But securities stocks eased 1.76 percent, led by Nikko. It fell 3.4 percent to 367 yen after its shareholders approved plans to transferits investment banking business to Salomon Smith Barney.
Real estate stocks led the market down, plunging 2.4 percent as a sector. Odakyu Real Estate was the biggest decliner on the Nikkei, plunging 9.5 percent to 220 yen.
Hong Kong stocks dipped 0.44 percent or 45.85 points to 10,315.44. They had been up in the morning but succumbed to selling pressure after lunch. Turnover was a paltry HK$4 billion.
"There is not much news in the market," said Core Pacific Yamaichi research director Alex Tang, who said a lower close in Tokyo had depressed the market.
"Over the last few days market trading has been very thin and there has not been much volatility to speak of. The index has been up maybe 30 points and down about 70."
Heavyweight HSBC led the index lower, losing 1.5 percent to HK$197. It had made major advances in recent days.
Traders were keenly awaiting a decision by the Bank of England on interest rates after the Hong Kong market closes. HSBC owns leading U.K. high street bank Midland.
But property-related stocks staved off heavier falls on the index. Cheung Kong rose 0.45 percent to HK$56.25 while New World Development leaped 1.41 percent to HK$19.4.
Red chips and H shares also fell, by 0.3 percent and 0.46 percent respectively.
These China-related plays had been positive in the morning on the back of a well-received $1 billion dollar mainland bond issue. But like the blue chips they fell away in the afternoon.
Singapore stocks put on another solid performance to climb 1.07 percent or 15.29 points to 1,439.88. But even they lost ground in the afternoon
Banking stocks were again in the spotlight. DBS Bank cut its prime lending rate and saw its stock rise 10 cents to S$7.95. OUB climbed 2 cents to S$4.24.
The Philippines jumped 3 percent while Australia added 0.48 percent by its close. Taiwan fell 0.97 percent.
Malaysia closed 0.65 percent higher while Indonesia finished up 1.22 percent. Thailand was closed.
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