Renewed concerns about credit markets and a slide in the U.S. dollar hurt some Asian financial and technology stocks Tuesday, but higher metals prices pushed Australian shares to close at a record high.
The International Monetary Fund said on Monday that turmoil in global credit and money markets was likely to continue as investors worry about the size of financial losses and where they might arise. Citigroup and other banks in the U.S. fell on fears there could be more upheaval from the subprime mortgage sector after Deutsche Bank said it might take a $2.4 billion hit to its quarterly profit as a result of the credit market turmoil.
Australian shares rose 0.5% to set a second straight record closing peak, largely bolstered by gains in top miner BHP Billiton on stronger base metal prices. However, Woodside Petroleum fell on softer oil prices and an analyst downgrade, while gold miners dropped after the price of the precious metal fell.
Tokyo's Nikkei 225 Average pared earlier losses to finish higher as shipping shares such as Marubeni gained on earnings hopes while Toyota Motor rose on a news report about its plan to launch a fuel-efficient ultra-compact car in Europe.
Singapore's Straits Times Index closed 0.4% lower. DBS Bank's Chief Executive Officer Jackson Tai resigned on Monday after a run of bad news battered the company's share price, leaving an unfulfilled quest to make the bank a big Asian player.
The Hong Kong Hang Seng finished 0.5% lower as China Mobile jumped to a lifetime high amid restructuring talk and after brokers upgraded the stock's price target. Shares of Hong Kong-listed airlines fell sharply as expectations of an industry restructuring waned after Cathay Pacific Airways and Air China's parent company aborted a plan to buy shares in China Eastern Airlines.
Chinese stocks closed 1.1% lower, with the debut of China Construction Bank soaking up liquidity and the fall in Chinese airline shares.