Monday's Asia Stocks Recap

Updated from 5:10 p.m. EDT

Indian stocks finished lower Monday after recovering more than 500 points from the lows in an extremely volatile trading session. Shares in the region were down sharply at the open but staged a late comeback led by the banks, metal and oil and gas sectors.

The Bombay Stock Exchange's Sensex Index finished marginally lower by 51 points, or 0.3%, at 15.923.72.

A report out of The Wall Street Journal Monday stated that India isn't going to be creating a sovereign-wealth fund anytime soon because of political disagreements and economic concerns. "Creating any kind of stabilization fund may not be justified, given the lack of a dominant exportable natural resource and consistent current account deficits," said the Reserve Bank of India Governor Y.V. Reddy.

Falling sharply on the news were the Indian closed-end management funds like Morgan Stanley India Investment Fund (IIF Quote), trading off 9% to $34.55, and The India Fund (IFN Quote), dropping 11% to $40.15. Newly launched Indian ETF WisdomTree India Earnings Fund (EPI Quote) avoided any serious selling pressure, closing off 2% at $22.25.

Indian pharmaceutical company Dr. Reddy's Laboratories (RDY Quote) announced it has entered into an agreement with Denmark-based 7TM Pharma to develop drugs to fight metabolic disorders like obesity and diabetes. The agreement will put both firms together to identify clinical drug candidates and develop these candidates from pre-clinical stage to phase II, according to a Dr Reddy's filing with the Bombay Stock Exchange. ADR shares of Dr. Reddy's fell 1.8% to $13.75.

Leading Indian banking giant HDFC Bank (HDB Quote) announced as part of its plans to expand its global presence, the bank will look to open up branches in both Canada and Singapore. HDFC plans to raise $1 billion from overseas markets to finance the global expansion, according to financialexpress.com.

Rival Indian bank and second largest by assets Icici Bank (IBN Quote) announced Monday it has opened up a New York branch in Midtown Manhattan. ADR shares of HDFC Bank fell 2% to $93.49, and Icici Bank declined 4.3% to $41.28.

Leading the decliners among Indian ADRs were Wipro (WIT Quote), trading off 4% to $10.28; Sify Technologies (SIFY Quote), falling 4% to $4.22; and Satyam Computer (SAY Quote), declining 3% to $22.67.

Be sure to check out the Far East Portfolio at Stockpickr.com every night to find out which stocks in India and China are making big moves and announcing major news.

China Recap

Stocks in China fell sharply Monday on elevated fears of rising inflation and on concerns the U.S. is slipping into a recession. Investors in the Far East are growing worried about the state of the U.S. economy, after the Labor Department announced a loss of 63,000 jobs for February. The drop in employment, which was reported on Friday, was the largest fall since March 2003.

The benchmark Shanghai Composite Index fell 152.22 points, or 3.6%, to 4,146.30.

Stocks in Hong Kong rebounded late in the trading day Monday to close higher. The late session rally was sparked by buying of defensive sectors that will act as safe havens in the case of a U.S. recession.

"Money remains in the market and has switched to defensive stocks, such as utilities,'' said Steven Leung, director of institutional sales at UOB-Kay Hian Ltd. The Hong Kong's Hang Seng index rose 203.72 points, or 0.9%, to 22,705.05.

Chinese specialty pharmaceutical company Tongjitang Chinese Medicines (TCM Quote) exploded 33% higher after the firm received a buyout offer from Chairman and Chief Executive Officer Xiaochun Wang and Director Yongcun Chen. The deal would pay $10.20 per ADR share and take the company private. ADR shares of Tongjitang Chinese Medicines closed at $8.86.