Profit-taking snuffs rally in both Shanghai markets

THE rally in Shanghai ran out of steam yesterday as traders took profits following Monday's surge in both A and B markets.

But the Credit Lyonnais Shanghai A index still managed to end 1.17 per cent higher at 6,639.42 points.

The CSLA Shanghai B index rose 1.55 per cent to 846.23 points.

Buying interest in Shanghai B shares was split between locals and overseas investors, brokers said.

The Shanghai B market was closed in the morning due to a computer failure but opened in the afternoon.

Turnover was US$1.81 million with Dazhong B the biggest gainer, finishing up 9.7 per cent at 79 cents.

Standard Chartered Asia said on Monday Dazhong Taxi Co would join Chicago-based Hertz Corp to invest about $6 million in car-leasing and rental services in Shanghai and other parts of China.

SHENZHEN PROFIT-TAKING sent the Shenzhen A market to a lower close.

The CSLA Shenzhen A index dropped 2.51 per cent to finish at 2,481.98 points.

A 7.8 per cent gain by Shenbao B was the main reason why the CSLA Shenzhen B index rose 0.65 per cent to 1,174.02 points.

SYDNEY UNCERTAINTY gripped the market, which closed lower as investors waited for clear trends to emerge.

Brokers said quiet trading showed many investors had been driven away by market volatility, while offshore players also remained nervous about the Australian dollar.

Much of the action was in the futures, which dragged the market sharply downwards after a 10-minute opening surge.

Regaining some ground, the All Ordinaries index traded in a narrow range before ending 4.7 points down at 1,509.4.

The market was within a point of Monday's close by late afternoon, but the gain was snuffed out by more aggressive futures selling, brokers said.

''The volatility of the market this week has been staggering,'' said Mr Geoff Wilson of Prudential-Bache.

''A lot of people are sitting on the sidelines and watching, rather than participating.'' WELLINGTON THE market recovered most of the 26.9 points it lost on Monday to close with the NZSE-40 Capital Index up 20.76 points at 1,520.71.

''It's the law of physics, what goes down must come up,'' said broker Peter Halligan at Buttle Wilson.

''It didn't deserve to be sold as much as it was yesterday,'' he said.

Leaders which were sold off on Monday in thin trade and a lack of buyers recovered, although volume was still thin at NZ$15 million.

MANILA PRICES slipped on profit-taking by investors, deflating a New Year's rally.

The Composite Index fell 5.92 points to end at 1,308.17.

''The market has been oversold. The slide started from the beginning of the session,'' said Mr Harry Liu, president of Summit Securities.

Another broker said the market might be gearing for another rally.

''All the issues have already bottomed out. They are now in the process of creating a major bull trend,'' said Mr Roy Nicolas, president of stock analyst company Great Angle.

Mr Nicolas said prices would probably move sideways for the rest of the week before finding the strength to move up again.

TAIPEI STOCKS rose on a technical rebound and hopes for a cut in the stock transaction tax, but brokers said further big rises were not likely as trading interest and investor confidence remained weak.

The Weighted Index closed 46.31 points or 1.5 per cent higher at 3,217.55. Turnover fell to NT$6.4 billion from Monday's $8.3 billion. All sectors rose.

Brokers said investors looked for bargains as they believed many stocks had been oversold during the market's recent plunge, but buying was very cautious amid political worries ahead of a cabinet reshuffle expected by early next month.

SEOUL STOCKS ended easier for the second consecutive day in what brokers described as a technical correction.

''Trading volume shrank sharply, with many investors on the sidelines. The slide was a natural reaction to the rises of last week,'' said Mr Jwa Yo-han of Coryo Securities.

Brokers said a period of consolidation would continue for the time being despite the underlying strength of the market.

The Composite Index fell 5.67 points to 702.75.

TOKYO STOCKS ended firmer on index-linked buying triggered by short-covering in futures contracts.

Hopes of lower interest rates also helped boost sentiment but lack of outright retail buying limited rises and the broader market remained soft, brokers said.

''It was just index-linked buying that pushed up the Nikkei average,'' said a broker. ''The market on the whole was spotty and underlying sentiment is still bearish in the longer term.'' The Nikkei rose 91.5 points to 16,681.05, with about 150 million shares traded.

SINGAPORE PRICES ended little changed but the market's undertone softened as sellers started to emerge.

''We seem to have gone up too fast, too soon. Prices are consolidating but with daily price erosion, which is not a good sign,'' a broker said.

The Straits Times Industrial Index closed up 1.06 points at 1,545.02. Volume was 67.2 million shares against 70.99 million on Monday.

A broker said the current price erosion was understandable as investors were prone to take profit in a slow market.

''When funds see the market stabilise, they will return as Singapore's fundamentals are improving. Nearer to the Lunar New Year, buyers should return,'' he added.

BANGKOK FOUR major banks and two big property firms rallied strongly, boosting the stock index but there were more declines than advances.

The SET Index climbed 6.9 points to close at 933.6 on a turnover of 8.21 billion baht.

Declines slightly led advances by 122 to 118 with 59 issues unchanged.

Brokers said turnover in the banking sector shrank.

''Investors bought banks and finance and securities firms at the start, then sold,'' said a broker.

''They then bought property firms, with some coming back to buy banks again.'' The index has climbed 46.43 points, or 5.23 per cent, in the past six trading days. KUALA LUMPUR PRICES closed lower on further liquidation by both retail and institutional investors as talk of lower-than-expected Malaysian economic growth in the lastquarter of last year continued to affect market sentiment.

Brokers said expectations of a slowdown in the economy this year also prompted foreign fund managers to trim their share portfolios.

However, some late bargain-hunting emerged to lift prices from the day's lows.

The Composite Index fell five points to 616.46.

Analysts said the market would remain soft in the near term with the next key support level seen at 600 points.

JAKARTA SENTIMENT shifted from morning lethargy to afternoon verve in hectic trading by the close, with both local and foreign investors becoming more active.

Brokers said prices ended mixed and buyers remained selective, with some blue chips rising slightly and others barely changing.

The market index eased 0.45 point to 278.07.

The Chinese share prices are provided by Telerate. All other prices are provided by Reuter.