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Major Asian Markets Lose Ground - 2003-08-08

Major markets in Asia lost ground this week. A weakening of the U.S. Nasdaq index promoted selling in South Korean and Taiwanese technology shares, which had performed well in past weeks.

Taiwan's main share index lost about three percent over the week, finishing Friday at 5,232.

One stock market analyst says investors were taking profit following the Taiwan market's strong performance in previous weeks.

Nilesh Jasani, an analyst at the investment arm of HSBC bank, says the technology shares in Taiwan and India both have been doing well.

"Taiwan technology sector, India's technology companies, all of them are up close to or over 25 percent in the last two months," he said. "So technology companies have been doing very well. It's somewhat surprising they are doing very well when global technology sectors have stopped moving."

Mr. Jasani says Seoul's Kospi index has also been one of the best performing markets in Asia in past months. He says it was buoyed in part by hopes that the government may spend money to stimulate the economy.

Investors become more cautious this week after data from the Bank of Korea showed a lack of strong business confidence. Traders say the pace of economic recovery is below investors' expectations.

The Kospi index lost three percent over the week to end at 704 points on Friday.

In Tokyo, solid earnings from leading firms such as DoCoMo and Sega Corporation gave the market a lift on Friday, breaking a four-day losing streak.

Despite gaining more than 60 points Friday, the Nikkei 225 was down three percent for the week at 9,327.

Hong Kong earnings for the second quarter have surprised the markets and many investment analysts will be raising their corporate forecasts for the year. The territory had been expecting great losses for the first half of the year, because business slowed due to the outbreak of Severe Acute Respiratory Syndrome in the territory.

"You can safely say that SARS damage on corporate earnings were really not as bad as expected," said Mr. Jasani.

Still, Hong Kong's Hang Seng index was trading about 200 points lower than last week's close, ending Friday at 9,945 points.

Mr. Jasani says the selling came on the back of losses on Wall Street.