Most Asian Indices Down as Ugly Week Comes to an End

Includes: EWH, EWJ, FXI, PKX, SNE, TM
by: Steven Towns

It has been an up-down ride for Chinese stocks since Tuesday's sell-off, while Japanese stocks fell for the fourth straight session. Some see Chinese stocks as oversold and therefore, buyers moved in to pick up battered stocks. A BNP Paribas (Hong Kong) trader says, "It's very much China-related in terms of sentiment in Hong Kong at the moment; if China goes crazy, Hong Kong will follow, in either direction." FXI-EWH-EWJ-EPP-year-to-date-chart-03-01-07 The Shanghai Composite gained 1.2% and the Hang Seng rose 0.5%. In Japan, a strengthening yen kept selling pressure on exporters such as Sony and Toyota, as the Nikkei 225 lost 1.35%. Also, data showing zero inflation in January created uncertainty about when the Bank of Japan might raise interest rates again. Benchmark indices in Seoul and Taiwan traded slightly lower. South Korean steelmaker POSCO traded higher on news Warren Buffett owns a 4% stake. Singapore and Australia were off by 0.45% and 0.40%, respectively. The Kuala Lumpur Composite lost 1.4% and India's BSE Index is down 2% in late trading.

Sources: Bloomberg [I, II], MarketWatch
Commentary: China's Total Market Cap? Don't Ask!David Fry's Daily Market OutlookGlobal ETFs: From Overbought To Oversold
Stocks/ETFs to watch: POSCO (NYSE:PKX), Sony (NYSE:SNE), Toyota (NYSE:TM). ETFs: iShares Trust FTSE-Xinhua China 25 Index Fund (NYSEARCA:FXI), PowerShares Golden Dragon Halter USX China Portfolio (NYSEARCA:PGJ); iShares MSCI Asian Indices: Australia (NYSEARCA:EWA), Hong Kong (NYSEARCA:EWH), Japan (NYSEARCA:EWJ), Malaysia (NYSEARCA:EWM), Singapore (NYSEARCA:EWS), South Korea (NYSEARCA:EWY), Taiwan (NYSEARCA:EWT), Emerging Markets Index (NYSEARCA:EEM), Pacific ex-Japan (NYSEARCA:EPP); Closed-end India funds: (NYSE:IFN) and (NYSE:IIF); iPath MSCI India Index ETN (NYSEARCA:INP)

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