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By Rafael Nam
HONG KONG, May 13 (Reuters) - Oil prices retreated on
Tuesday as some investors saw a recent rally to record highs as
excessive, while Asian shares gained as banks were bolstered by
further signals the worst of the credit crisis may now be over.
Trading was subdued for the most part, with the dollar
steadying against the yen ahead of April U.S. retail sales data
due out later in the day, as well as a speech from Federal
Reserve Chairman Ben Bernanke.
The earthquake on Monday that killed nearly 10,000 people
in southwest China hit shares in Shanghai <>, though
trading was suspended in companies directly affected. Still, it
failed to have an impact elsewhere in the region amid
expectations the economic fallout will be limited.
Inflationary pressures from rising food and energy costs,
and further fallout from the global credit crisis, have been
among the most pressing concerns to investors in Asia this
year, and despite a more positive tone, little appeared to
change on Tuesday.
Analysts attributed the fall in crude futures mainly to
booking profits after prices set a string of records last week,
hitting an all-time peak of $126.40 on Monday, and bringing its
gains so far this month to around 15 percent.
The surge has been led by concerns over supply disruptions
in the North Sea and Nigeria.
"The pitch of the rise (of oil prices) has been very rapid
since the start of the month so it's about time that we saw
some profit-taking," said Tatsuo Kageyama, an analyst at
Kanetsu Asset Management in Tokyo.
Crude <CLc1> was down 75 cents at $123.48 a barrel at 0249
GMT.
The tone in stock markets was more positive, with the MSCI's
measure of Asian stocks outside Japan <.MIAPJ0000PUS> up 0.2
percent, taking its gains since hitting a mid-March low to 17
percent. The index is still down more than 8 percent this year.
Banking shares such as Japan's Mizuho Financial Group
<8411.T> were among the day's gainers after MBIA Inc <MBI.N>,
the world's largest bond insurer, said its new business volumes
appear to be rising in the current quarter in a sector that has
been a key source of concern during the global credit crisis.
The outlook took the sting off MBIA's quarterly loss of
$2.4 billion on Monday as it took charges on billions of
dollars of exposure to bonds linked to subprime mortgages.
[]
Meanwhile, Europe's biggest bank, HSBC Holdings <HSBA.L>
<0005.HK> said its profit in the first quarter beat a year ago
as growth in Asia helped counter some $5 billion in hits from
bad debts on U.S. home loans and asset writedowns.
[]
Japan's Nikkei share average <> rose 0.6 percent, with
exporters also gaining on a softening Japanese yen <JPY=> that
could make their products more competitive in key overseas
markets and boost returns from abroad.
Taiwan's shares <> rose 1.2 percent while Singapore
<.FTSTI> gained 0.4. Indexes in South Korea <> and
Australia <> were flat.
Shares in Hong Kong <> gained 0.3 percent led by a 1.5
percent gain in HSBC following the update about its quarter.
Other gainers included Aluminum Corp of China Ltd <2600.HK>
and online services provider Tencent <0700.HK> surged after the
bourse operator said on Friday they will be added to the Hong
Kong's blue-chip index.
Markets in Hong Kong and South Korea were closed on Monday
for a public holiday.
CHINA HIT
But China's benchmark stock index <> fell 1.3 percent,
after earlier being down more than 3 percent, on uncertainty
following the deadly earthquake. Shares were also dented after
the central bank announced on Monday the fourth bank reserve
ratio hike this year.
Insurance shares were particularly hit, with China Life
Insurance <601628.SS> down 3.6 percent.
Elsewhere markets were subdued, with the dollar trading at
103.91 yen <JPY=>, little changed from Monday's levels.
"Players are unsure whether credit-related woes have really
bottomed out or whether troubles will keep surfacing," said a
dealer at a European bank in Tokyo.
Gold <XAU=> fell to $879.50/880.50 an ounce from
$884.60/884.20 late on Monday, as the halt in crude oil's climb
dented the appeal of the metal as a hedge against inflation.
Bullion prices have fallen more than 14 percent since
reaching a record high at $1,030.80 an ounce on March 17. It
tumbled to a four-month low of $845 in early May.
(Editing by Lincoln Feast)
