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Asian Markets Rally Tuesday - 2002-07-23


The key Asian stock markets rallied Tuesday, even after shares on Wall Street continue their steep slide. But some analysts say Asian shares remain vulnerable.

Asian markets were resilient, despite the negative sentiment emanating from Wall Street. On the Tokyo Stock Exchange - Asia's largest share market - the Nikkei index finished Tuesday 26 points higher at 10,215. The gain followed encouraging words from Heizo Takenaka, Japan's minister in charge of economic policy. Mr. Takenaka says the U.S. economy is strong and production there is healthy. He also says Wall Street's plunge will not have a severe impact in Japan.

Monday in the United States, the Dow Jones Industrial Average dropped three percent, following a loss of almost five percent Friday. Corporate scandals and weak earnings have rocked investor confidence in Wall Street.

Taiwan's main share index ended a six-day losing streak, and rose 2.5 percent Tuesday. Technology shares in Taipei rose despite falling prices for tech stocks on Wall Street.

Korea's Kospi index ended three percent higher, with auto makers seeing the biggest gains.

Analysts say bargain hunting helped buoy Asian markets Tuesday, but a full market rebound is not yet in sight. Andy Xie is the chief economist with Morgan Stanley Asia. He warns Asian markets could remain weak for months. "The markets are going to be choppy for quite a while," he said. "And until the U.S. market bottoms there is always going to be an overcast. On a day-to-day basis you might see a rebound but I think the uncertainty is still there for the next six months."

Hong Kong's Hang Seng Index ended up two percent at 10,313. The Thailand and Singapore markets also closed on a positive note.

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