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Asian Stocks End Week Mixed - 2004-04-16


Stocks in Asia ended the week mixed, with some markets hurt by speculation about an interest rate hike in the United States, which could lead to selling on Wall Street.

Financial analysts speculated Friday that the U.S. Federal Reserve could raise interest rates on the strength of positive U.S. economic data. Higher interest rates will draw money away from stock markets into bond markets and bank accounts.

Those worries helped push Asian equities lower.

Hong Kong's Hang Seng index ended the week down on Friday, finishing at 12,458, a 3.4 percent decline from last week's end.

Ben Rudd, a strategist in Hong Kong with ABN Amro Bank, says investors here were not only reacting to concerns of a U.S. interest rate hike, but also to worriers over China's economy.

On Friday, the governor of the People's Bank of China did not rule out further interest rate hikes as a possible option for slowing China's economy.

Mr. Rudd says investors are concerned China's economy is at risk of overheating and crashing, and many are asking whether Chinese authorities will be able to manage a controlled slowdown.

"More and more question marks are basically being asked about the prospects of the slowdown coming through in terms of the Chinese economy and what that means for the markets around the region which have basically been very big beneficiaries of that strong growth from mainland China," said Ben Rudd.

Tokyo's Nikkei index traded higher on Friday after profit-taking emerged late Thursday. The index reached a 32-month high and ended Friday at 11,824.

In South Korea, the main stock market index, the Kospi, ended seven points lower this week at 898. Mr. Rudd says the South Korean elections had little effect on the market.

Taiwan's main share index closed three percent higher this week, ending Friday at 6,818.

Traders say investors were focusing on positive economic indicators rather than Taiwan's controversial presidential elections.

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