* Stocks extend losses, traders unsure if correction
looming
* Tokyo shares down 1.2 percent, Hong Kong 0.8 percent
* Losses inevitable after Dow slide, but seen more muted
* Kiwi, Aussie dollars up as some appetite for risk
surfaces
By Raju Gopalakrishnan
SINGAPORE, Jan 25 (Reuters) - Asian stocks fell on Monday
after Wall Street suffered its worst three-day slide in 10
months, but losses were muted, and high-yielding currencies
edged up as some investor appetite for riskier assets surfaced.
Disappointing results announced by Google Inc <GOOG.O> on
Friday dragged down tech-related shares in Tokyo, pushing the
Nikkei index <> down 1.2 percent, but analysts shrugged
off the fall.
They said that while Tokyo had been hit by an inevitable
negative reaction given the sharp U.S. losses, there were some
signs that its declines might be relatively small.
"Stocks that you might have expected to have really lost a
lot, such as the megabanks, aren't down so much, and that's
true of a lot of the big-cap shares as well," said Nagayuki
Yamagishi, a strategist at Mitsubishi UFJ Securities.
"There's the chance that foreigners may be buying, that
there could be a bit of a pull-back from the United States and
Europe that's coming into Japan."
Wall Street stocks fell as much as 2.7 percent on Friday
on
worries over President Barack Obama's plan to curb bank
risk-taking, which could hit their profits, and on Google's
result. []
With the sudden loss of leadership from the financial and
tech sectors, which have led a global rally in recent months,
analysts are unsure if equities will continue to sink. Some
investors fear the global economic recovery may be slowing, and
a number of technical indicators point to further weakness.
The main U.S. stock indices have lost all the gains made
this year and fell below key support levels and their 50-day
moving averages, a move seen as a bearish signal.
The MSCI index for Asia ex-Japan shares <.MIAPOOPUS> was
down 0.72 percent on Monday.
On foreign exchange markets, high-yielding currencies like
the Aussie <AUD=> and the kiwi <NZD=> rose on Monday, inching
up to $0.9070 and $0.7160 respectively, from $0.9003 and
$0.7110 late on Friday.
Analysts said risk appetite had been lifted by reports that
Federal Reserve Chairman Ben Bernanke was moving closer towards
confirmation for a second term.
Investors were spooked last week after several key senators
announced their opposition to Bernanke's reappointment but the
top Senate Republican predicted confirmation. []
The U.S. dollar edged up against the yen to 90.20 yen
<JPY=>, from 89.87 yen late on Friday in New York but fell
about 0.1 percent against a basket of six currencies <.DXY>.
The greenback had struck a five-week high against the
dollar and a nine-month high on the euro on Friday as investors
rushed towards safe-haven assets.
Still, demand for riskier assets and higher-yielding
currencies is likely to remain subdued amid rising concerns
over Greece's fiscal problems; worries that China's efforts to
curb its surging economy may impair global growth and fears
that the populist turn at the White House might impact U.S.
bank earnings.
Traders are awaiting the response to Greece's proposed
issue of a 5-year benchmark bond issue later on Monday as a
test of investor appetite, analysts said. []
On other markets, crude oil <CLc1> steadied near its
four-week low of below $75 a barrel, while spot gold <XAU=>
trekked upward to $1,098.65 per ounce from the New York close
of $1,091.65 as the dollar edged down.
(Editing by Kim Coghill)
