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Asian Markets Update: Korean Market Bloodied by Ford's Pullout

Japan's markets slide in profit-taking ahead of first-half close.

TOKYO -- Things weren't looking good for Asian shares Monday. Japanese stocks were hit by light profit-taking ahead of the close of the fiscal first half, while Korea got pummeled amid ongoing troubles at

Daewoo Motors



Nikkei 225

index shed 152.12 to close at 16,061.16, while the


index, which includes all shares listed on the

Tokyo Stock Exchange's

first section, lost 2.55 to stand at 1481.04. The


small-cap index fell 1.32, or 1.7%, to finish at 76.74, while the Nikkei


index shed 15.62, or 1.0%, to end at 1626.33.

Institutional investors in Japan sold shares before their books close for the fiscal first half on Sept. 30, mostly shedding large-cap electronic shares.



lost 95 yen, or 3.4%, to 2735 ($25.56),


shed 90, or 3.1%, to 2790, while



fell 670, or 4.3%, to 14,900. The selling, however, was in extreme light volume, traders noted.


tumbled 1110, or 9.7%, to 10,370 amid news that the firm would sell some of its stake in

Sky Perfect Communications

, a digital satellite firm. The

Nihon Keizai Shimbun

reported that Softbank would sell about 45,000 shares from its existing stake of 182,000 when Sky Perfect goes public on the TSE's


exchange late October. Some traders said Softbank's move highlighted the fact the firm was strapped for cash.

On the upside,

Fujisawa Pharmaceutical

rose 280, or 7.4%, to 4080, while

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Nippon Telegraph & Telephone


climbed 40,000, or 3.2%, to 1.3 million. Local reports said NTT may spin off its international unit NTT Communications to raise funds for more acquisitions.

Meanwhile, currency dealers were busy shorting the euro, which fell to a new low of 0.8510 against the dollar during Asian trading. The greenback fell slightly lower against the yen to recently fetch 107.02.

Korea's market sentiment deteriorated after U.S. auto giant


(F) - Get Ford Motor Company Report

said it was

pulling out of its planned buyout of troubled Daewoo Motors last week, prompting the key


index on Monday to drop 50.64, or 8.1%, to close at 577.56. Ford's pullout could pave the way for rivals






to come back into the game and negotiate with Daewoo. However, until a concrete deal has been made, foreign investors are fleeing Seoul for now, traders said.

Among the hardest hit in Seoul were

Hanvit Bank

, down KW265, or 15.0%, to 1505 ($1.34) and

Daewoo Securities

, down 1070, or 12.2%, to 7700.

Hong Kong's

Hang Seng

index fell 689.37, or 4.2%, to stand at 15,560.16 largely on concerns over higher oil prices and the weakness in the euro. The index falling below its 250-day moving average of 15,800 also triggered massive technical selling, traders added.



lost HK$5.50, or 5.0%, to 105.50 ($13.53).

Telecom firms didn't do any better, with

Pacific Century Cyberworks


shedding 0.90, or 7.7%, to 10.75 and

Hutchison Whampoa

losing 2.00, or 1.9%, to 103.50.