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* Asia stocks fall after oil spikes $5 overnight
* Financial sector hurt by report Lehman needs more capital
* Investors prepare for higher borrowing costs
By Kevin Plumberg
HONG KONG, June 12 (Reuters) - Asian stocks fell on
Thursday after oil prices jumped $5 to near record highs on a
report showing four weeks of tightening supply, adding to fears
about rising inflation around the world.
Financial companies, such as Sumitomo Mitsui Financial
Group <8136.T> and National Australia Bank <NAB.AX>, were under
fire, after a report that U.S. investment bank Lehman Brothers
<LEH.N> could hunt for more capital after already raising $6
billion, raising questions about the company's management.
[]
Meanwhile, oil's unrelenting climb has made investors
nervous about higher borrowing costs, especially after Federal
Reserve Chairman Ben Bernanke earlier this week said the recent
rise in oil has increased the chances that inflation pressures
will grow.
"Inflation worries are heightening the possibility that
central banks, including those of South Korea and the United
States, will raise key interest rates in the near future," said
Y.S. Rhoo, a market analyst at Hyundai Securities.
Japan's Nikkei share average fell 2.3 percent to the lowest
level in two weeks. Exporters with high-profile brands overseas
were some of the heaviest hit, such as Canon Inc <7751.T> and
Honda Motor Co. <7267.T>.
Korea's KOSPI declined 1.3 percent <>, led by POSCO Co
Ltd <005490.KS>, the world's fourth largest steelmaker.
Stocks in Singapore fell 1.8 percent <.FTSTI>, following
the decline on major U.S. indexes.
Investors will focus on an Australian employment report due
at 0130 GMT and a policy decision from the Bank of Korea due at
0230 GMT. Several central banks in the region, including China,
India, Indonesia and the Philippines, have begun to tighten
monetary policy to fight upward pressure on prices.
U.S. light crude prices were up 16 cents to $136.54 <CLc1>
after rising around $5 overnight, less than $3 from the
all-time high of $139.12 hit last week.
Oil prices have risen nearly seven-fold since 2002, partly
because of rising demand from China and other rapidly
developing countries, pressuring major consumer the United
States, which is already hobbled by a housing slowdown and
credit crunch.
Representatives of the world's biggest oil consumer and
producer nations will meet in Saudi Arabia on June 22 to
discuss the oil spike, which producer group OPEC says is due to
speculation, not a lack of supply. []
The U.S. dollar rose against the euro and yen, continuing
to rally on hopes the Fed will raise U.S. interest rates this
year.
The euro slipped 0.1 percent to $1.5534 <EUR=>. Against the
yen, the dollar rose 0.1 percent to 106.95 yen <JPY=>.
The dollar climbed to a 3-1/2-month high against the yen on
Wednesday, bolstered Bernanke's stronger comments about
containing inflation.
Bernanke warned markets the Fed will not be complacent as
declines in the dollar helped to spur crude's 40 percent climb
so far this year.
(Additional reporting by Park Jung-youn in SEOUL; Editing by
Louise Heavens)
