Most Asian markets finished in the red Friday, with worries about inflation weighing on indexes in Shanghai and Mumbai while Hong Kong stocks extended their decline ahead of a long weekend.

For the week, Asian stocks generally tallied losses.

Australian indexes ended the day and the week on the positive side, however, as resource stocks such as BHP Billiton rode higher on the back of soaring crude oil prices.

Japanese stocks ended lower, as investors reacted with disappointment to results reported by blue chips such as Toyota Motor Corp., Bridgestone Corp. and Softbank Corp.

Tokyo's Nikkei 225 Average finished 2.1% down at 13,655.34, thus ending the holiday-shortened trading week 2.8% lower. The broader Topix index lost 2.3% to end the session at 1,341.76.

China's Shanghai Composite, which tracks yuan-denominated A-shares as well as B-shares denominated in foreign currencies, gave up 1.2% to 3,613.49 during the session, also losing more than 2% for the week.

Monthly inflation data for the mainland are due out next Monday. "Investors want to see whether the central bank will take any further (tightening) measures" in light of what the figures show, said Patrick Shum, strategist at Karl Thomson Securities in Hong Kong.

In Hong Kong, the benchmark Hang Seng Index lost 1.5% to 25,063.17, while the Hang Seng China Enterprises, or H-share index, dropped 1.6% to 13,662.58.

Shum said that the weakness in Shanghai and an extended weekend provided an excuse for investors in Hong Kong to lock in profits but that thin trading volumes for the day suggested "selling pressure isn't very strong." He expects the Hang Seng to find support at the psychologically important 25,000-point level next week.

Bad week for Mumbai

In late afternoon trading, India's Sensitive Index lost 1.5% to 16,832.38, setting the Sensex up for a fifth consecutive daily decline, amid persistent worries about rising inflation. The broader S&P/CNX Nifty index gave up 1.3% to 5,016.20.

"Over the past few days, the worst possible macroeconomic outcome for India seems to be unfolding with a depreciating currency and stronger commodity prices. This macro outcome lends itself to higher inflation and thus a tighter monetary environment, and creates downside risk to growth," wrote Morgan Stanley analysts in a report.

Data released earlier in the day showed India's inflation, as measured by an index tracking wholesale prices, accelerated to 7.61% in the week ended April 26 from the year-ago period, compared with a 7.57% reading in the week ended April 19.

Australia's S&P/ASX 200, meanwhile, rose 0.9% to 5,771.80, ending the week with a gain of more than 1%.

Earlier Friday, the Reserve Bank of Australia raised its inflation forecast for the year, noting underlying consumer prices are likely to remain above its target band until late 2010 at the earliest -- dampening expectations interest rates could fall from their current 12-year high of 7.25% any time soon.

The central bank forecast headline growth in its consumer-price index will rise to 4.25% by June and peak at 4.5% in December, eventually falling back to 2.75% by the end of 2010.

Elsewhere in the region, Taiwan's Weighted index lost 0.8% to 8,792.39 and South Korea's Kospi gave up 1.3% to 1,823.70. In late afternoon trading, Singapore's Straits Times Index slipped 0.3% to 3,162.03.

Regional detail

Shares of Toyota (TM) finished 3.3% lower in Tokyo, retreating after the automaker reported Thursday that net income was 316.8 billion yen ($3 billion) for the quarter ended March 31, down from 440 billion yen in the year-earlier period, on weak U.S. demand, a stronger yen and soaring costs for raw materials.

As for Bridgestone , shares sank 6.2%. Nikko Citigroup and Credit Suisse reportedly issued downgrades in the wake of its quarterly earnings reported Thursday.

Shares of other exporters also declined on a strengthened yen, with Canon Inc. (CAJ) dropping 2.6% and Nintendo Co. (NTDOY) shedding 0.7%.

Shares of Softbank (9984.TO) gave up 2.8%, a day after the telecommunications firm posted a bigger-than-expected drop in quarterly operating profit on higher marketing costs.

Toshiba Corp. (6502.TO) saw its shares advance in early trading. On Thursday, the company said it expected operating profit to more than double in the next three years, but Toshiba's shares ended 0.8% lower in the broad market weakness.

Bucking the trend, shares of Japan Tobacco Inc. climbed 3.8% on reports the company's considering raising cigarette prices in the domestic market to offset higher costs and a decline in demand.

In currency trading, the U.S. dollar bought 103.60 yen in Asia, compared with 103.88 yen late Thursday in New York.

Also on the move higher, shares of Chinese insurer Ping An Insurance (Group) Co. climbed by 0.6% in Hong Kong and by 2.2% in Shanghai. The company said it won't go ahead with its proposal to issue a large number of shares in Shanghai within the next six months.

Oil impact

Some resource stocks rallied in Asia as crude-oil prices stayed near the $124- a-barrel level. June crude-oil futures jumped as much as $1.18 a barrel in electronic trading, after finishing at $123.69 a barrel Thursday on the New York Mercantile Exchange.

Shares of BHP Billiton (BHP) jumped 3.5% and Oil Search rose 0.7% in Sydney, while Korea Zinc advanced 1.5% in Seoul and Cnooc Ltd. (CEO) climbed 0.4% in Hong Kong.

However, China Petroleum (SNP), the oil refining and marketing company known as Sinopec, lost 3.3% in Hong Kong as well as Shanghai on fears that rising crude prices will widen the company's losses on petroleum product sales.

Airline stocks also declined, with Cathay Pacific (CPCAY) dropping 4.2% and Air China losing 0.5% in Hong Kong, China Airlines giving up 1.3% in Taipei and Jet Airways losing 3.4% in Mumbai trading.

In Thursday's action on Wall Street, the Dow Jones Industrial Average (DJI) finished 52.43 points higher at 12,866.78 and the S&P 500 index (SPX) rose 5.11 points to 1,397.68, while the Nasdaq Composite (RIXF) added 12.75 points to 2, 451.24.

U.S. stocks were headed for a weaker open on Friday, however.

  (END) Dow Jones Newswires
  05-09-08 1040ET
  Copyright (c) 2008 Dow Jones & Company, Inc.