RTTNews - The markets across the Asia-Pacific region drifted into negative territory amid concerns about the U.S. economy following weak U.S. private employment and services reports. Profit taking following recent rally and caution ahead of key U.S. jobs report, coupled with lower commodity prices in international market influenced the markets across the region. However, the Indian market ended in positive territory, bucking the overall trend in the region on expectation of more reforms from the new Government.

In the U.S., a report released by Automatic Data Processing Inc., or ADP, revealed that non-farm private employment fell by 532,000 jobs in May following a revised decrease of 545,000 jobs in April. Economists had expected a decrease of about 525,000 jobs compared to the decline of 491,000 jobs originally reported for the previous month.

A separate report from the Institute for Supply Management revealed that its index of activity in the service sector rose to 44.0 in May from 43.7 in April, although a reading below 50 indicates a continued contraction in the sector. Economists had been expecting a somewhat more notable increase to a reading of 45.0.

The Commerce Department, in a separate release, revealed a notable increase in factory orders in the month of April, but the increase came after a substantial decline in the previous month and was slightly below economist estimates.

The Dow closed down 65.63 points or 0.8% at 8,675, the Nasdaq closed down 10.88 points or 0.6% at 1,826, and the S&P 500 fell 12.98 points or 1.4% to 932.

Japan's Nikkei 225 Average opened lower by more than 50 points at 9,692, reflecting the losses on Wall Street. The market recovered smartly and moved above the unchanged line in the morning session to 9743. However, profit taking in the afternoon ahead of a key non-farm employment report in the U.S due on Friday and a lack of buying interest dragged the index down, as it closed at 9,669, down 72.71 points, or 0.75%. The broader Topix Index of all first section issues also edged down 3.51 points, or 0.38% to close at 911.

On the economic front, the Ministry of Finance stated that Japanese companies reduced their spending on plant and equipment in the first quarter of 2009. Capital spending plunged 25.3% during the Jan-Mar period in 2009, following a 17.3% decline in the last 3 months of 2008. Economists were expecting a 30% fall in investment.

Crude oil prices recovered from a slump in the international market on Wednesday and ended with a gain of 57 cents at $66.19 a barrel in Asian trading. Light sweet crude for July delivery closed sharply lower at $66.12 in New York Mercantile Exchange on Wednesday on weaker economic data in the U.S.

Shipping stocks ended weaker on profit taking following their recent gains. Kawasaki Kisen lost 3.51%, Nippon Yuesen fell 4.52%, and Mitsui OSK Lines shed 3.41%.

Mixed trend was witnessed among automotive stocks. Mitsubishi Motors surged up more than 15% following news that the company is planning to sell plug-in electric vehicles in the country in the next 4 years. Nissan Motor Co., gained 1.68%. However, Toyota Motor lost 2.31%, and Honda Motor fell 1.22%, on profit taking.

Financial stocks ended in positive territory. Mitsuibishi UFJ gained 1.30%, Mizuho Financial added 1.28%, Resona Holdings advanced 2.64% and Sumitomo Mitsui rose 1.08%. Brokerage Nomura Holdings advanced 3.11% after Fitch Ratings affirmed ratings for debt in the U.K and U.S.

Australia's All Ordinaries Index opened below the 4,000-mark at 3,989 compared to its previous close of 4,009, mirroring the weak closing on Wall Street, and continued to slide further, dragged down by resource stocks on lower commodity prices in the international market. After moving sideways for the bulk of the session, the index slipped further in reaction to the trade balance report.

Profit taking ahead of the release of key economic numbers in the U.S. during the course of the week also led to some apprehension. The index ended at 3,933, down 76.80 points, or 1.92%. The benchmark S&P/ASX 200 Index followed a similar trend and ended down at 3,935, with a loss of 82.60 points, or 2.06%.

On the economic front, the Australian Bureau of Statistics revealed that the trade balance unexpectedly turned to a deficit in April, coming in at a seasonally adjusted shortfall of A$91 million. Exports were down 11 percent month-over-month in April, falling A$2.76 billion to A$21.68 billion, while imports fell 2 percent or A$367 million to A$21.771 billion. Economists were anticipating a A$1.7 billion surplus for April following the revised A$2.393 billion surplus in March.

Resource stocks led the declines after a measure of six commodities traded in London Metals Exchange, comprising of copper, zinc and nickel among others, declined 1.8% on Wednesday. BHP Billiton declined 5.18%, Orica Ltd shed 3.04%, Oz Minerals lost 3.33% and Rio Tinto slumped 6.56%. Among gold stocks, Lihir Gold lost 3.95%, Newcrest Mining shed 2.99% and Sino Gold edged down 0.77% on higher gold prices.

In oil stocks space, Woodside Petroleum lost 3.57%, Santos shed 3.08% and Oil Search fell 4.01%.

Banking stocks ended mixed on profit taking, Commonwealth Bank edged down 0.03%, National Australia Bank lost 3.93% and Westpac Banking slipped 0.16%. However, ANZ Bank bucked the trend and ended higher with a gain of 2.93%.

In Hong Kong, the Hang Seng Index opened lower at 18,418 and saw weakness, as property and resource stocks declined on profit taking. Strength in utility, and retail stocks helped limit the losses and the index ended lower at 18,503, down 73.70 points, or 0.40%.

Property stocks ended lower on profit taking. Henderson Land lost 3.27%, Hang Lung Property shed 3.57% and Sino Land fell 2.57%. All other property stocks also ended in negative territory.

PetroChina lost 1.08% and CNOOC, the largest offshore oil company in China, fell 2.55%. Aluminum Corp. of China, or CHALCO, edged down 0.96%.

China-related stocks ended in negative territory. China Mercantile Holdings lost 1.30%, China Resources slipped 1.48% and China Shenhua fell 0.98%.

Retailer Li & Fung, which supplies toys and other materials to Wal-Mart, surged up 6.85% after Wal-Mart reported that it would create 22,000 new jobs in the US during 2009. Utility stock HK & China Gas gained 4.56% on lower commodity prices.

In South Korea, the benchmark KOSPI Index ended in negative territory, as foreign institutional investors preferred to take profits amid concerns about the U.S economy. After opening lower at 1,410 compared to its previous close at 1,415, continued to drift lower amid selling spree by foreign institutional investors. The index ended the session with a loss of 36.75 points or 2.60% at 1,378.

Financials, shipbuilding, and construction stocks ended lower on FII selling. Technology and automakers gained on a weaker local currency, helping limit the losses to some extent.

Daewoo Engineering & Construction slumped more than 10% following recent rally. Among the financials, KB Financial shed 4.84% and Woori Finance fell 6.05%, on profit taking.

In India, the stock market ended in positive territory, erasing the losses in early trading on hopes of economic recovery. The address of the President to the two houses of Parliament also lifted the market sentiment.

The BSE Sensex gained 137.78 points, or 0.93% to close at 15,008, and the broader Nifty is up 0.93% or 41.95 points, at 4573.

Among the other major markets in the region, China's Shanghai Composite Index ended lower by 11.34 points or 0.41% at 2,767, Strait Times Index in Singapore ended lower by 0.88% or 21.08 points at 2,363 and Taiwan Weighted Index edged down 107.08 points or 1.55% to 6,786. However, Indonesia's Jakarta Composite Index gained 21.80 points, or 1.08% to close at 2,033.

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