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By Rafael Nam
HONG KONG, March 4 (Reuters) - Most major Asian stock
indexes dipped on Tuesday, as concern about weaker demand from
the United States was compounded by record-high commodity
prices, which will send costs for many companies spiralling
higher.
Although financial bookmakers were calling European markets
slightly higher, given their heavy weighting in oil and
resources stocks, they cautioned that any further bad news from
a bank or an insurer could see markets turn around.
Britain's FTSE 100 <>, Germany's Dax <> and
France's CAC-40 <> were seen rising between 0.2 and 0.4
percent.
Investors, who have one eye on a U.S. economy which is in,
or entering a recession, are also concerned about the impact of
rising costs for raw materials, such as platinum and gold,
crude oil, tin and palm oil.
But the gains in commodities left some analysts puzzled.
"The rally defies conventional thinking. Each time lousy
(economic) numbers come out, prices go higher. Even when Warren
Buffett said the United States is in recession, the market just
went barreling ahead," MF Global analyst Edward Meir said.
MSCI'S measure of Asian stocks outside Japan
<.MIAPJ0000PUS> fell 0.5 percent as of 0220 GMT, after already
suffering its biggest one-day percentage drop in six weeks with
a 3.1 percent fall on Monday.
CATCH A U.S. COLD
MSCI's Asian index has dropped more than 11 percent this
year, in part dragged lower by the financial sector and
export-reliant companies as investors fret about a slowing U.S.
economy, which U.S. billionaire investor Warren Buffett on
Monday labelled as "in a recession".
Still, some pockets of economic strength in Asia are
supporting stock markets, for example, South Korea.
Seoul shares <> rose 0.3 percent after data showed the
country's industrial output increased a much
stronger-than-expected 2.5 percent in January after seasonal
adjustments. []
Among the few other gainers, shares in Taiwan <> rose
2.5 percent as blue chips gained ahead of the presidential
election this month.
Japan's Nikkei average <> ended flat after hitting a
six-week low earlier in the session, as some exporters rose on
the back of a more stable yen, although financial shares
remained weak amid continued credit concerns.
Japan's Sony Corp <6758.T> and South Korea's Samsung
Electronics <005930.KS> both gained on reports they would
likely invest $1.9 billion jointly for a new production line
for red-hot flat screens. []
But credit and subprime concerns remain at the top of the
watchlist after U.S. mortgage lender Thornburg Mortgage Inc
<TMA.N> plunged on Monday on worries it was facing bankruptcy,
and following more brokerage downgrades of global lenders.
Australian stocks <> fell 0.5 percent as worries about
the troubled credit markets continued to weigh and as
Australia's central bank raised interest rates to a 12-year
peak. []
Markets in China <> fell 1.9 percent by late trade,
while Hong Kong <>, India <> and Singapore <.FTSTI>
were down less than 1 percent.
HOT METAL
Spot platinum <XPT=> hit a record $2,243 an ounce, up from
$2,230/$2,237 late in New York on Monday as the weakening
dollar and supply problems in main producer South Africa
triggered speculative buying. Spot palladium <XPD=> tracked the
rally, jumping at one point to a 6-1/2-year high.
Gold <XAU=> stayed within sight of Monday's record of
$989.30 an ounce, trading in Asia at $981.90/$982.70.
Oil held well above $102, but off a record of almost $104
reached in the previous session, supported by expectations that
OPEC, the Organization of the Petroleum Exporting Countries,
will leave output unchanged when it meets on Wednesday.
The dollar steadied above record lows hit on Monday against
the euro and a basket of currencies after euro zone officials
expressed concerns about the sharp rise of the single currency.
The dollar was steady against the Japanese yen <JPY=>,
trading at 103.42.
