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Asian Markets Head for Worst Quarter in Over 5 Years

Asian markets ended mostly weaker Monday, heading for their worst quarterly performance in over five years. Japan finished down over 2 percent, but South Korea and Australia managed to eke out slight gains after treading lower for most of the session.

Oil prices, among the top performing asset classes so far this year, extended falls from the previous session after the restart of a crude pipeline system in Iraq eased concerns over supply.

A choppy U.S. dollar kept other commodity prices steady, following a quarter in which a slumping greenback has sent the prices of asset classes such as gold to record highs.

Tokyo's Nikkei 225 Average declined 2.3 percent as investors rushed to take profits and sold blue-chip shares such as Toyota Motor. The Nikkei ended the quarter down 18.2 percent, its worst quarterly performance since mid-2001. It lost 27.6 percent in the fiscal year ending on Monday. Bank shares slid, with Mizuho Financial Group down 5.4 percent, after U.S. financial firms fell on concerns about potential dividend cuts. Trading house Marubeni plunged more than 6 percent after Lehman Brothers said it planned to sue Marubeni for repayment over a case of suspected fraud.

Japan's industrial output fell 1.2 percent in February from a month earlier, compared with a median market forecast for a 2.1 decline. Manufacturers' output, the core component of production, is expected to rise 2.0 percent in March but decrease 1.0 percent in April, data from the Ministry of Economy, Trade and Industry showed on Monday.

Seoul stocks closed up a slight 0.13 percent after wavering in and out of negative territory all day, with gains by memory
chipmakers such as Samsung Electronics offsetting losses by financials. Samsung Electronics and Hynix Semiconductor both advanced, boosted by speculation a Japanese rival plans to raise memory chip prices.

Australian shares finished little changed, though the index suffered its worst quarterly performance since becoming the benchmark in 2000 amid turmoil in credit markets and fears of a U.S. recession. The S&P/ASX 200 Index fell 15.5 percent in the first quarter. It edged up just 0.1 percent today, buoyed by gains in recent laggards such as shopping mall owner Westfield Group, though ongoing credit worries hit banks such as Commonwealth Bank of
Australia.

Hong Kong stocks tracked softer overseas markets, down almost 2 percent, snapping four straight days of gains which saw the index rise more than 2,000 points. Solargiga Energy edged up slightly after a flat open as the Chinese solar wafer maker made its market debut.

Singapore's Straits Times Index was 1.1 percent lower, but Olam International closed 3.9 percent higher after the commodities firm said it plans to raise funds through a share sale.

China's Shanghai CompositeIndex, which surged almost 5 percent on Friday because of rumors that authorities would act over the weekend to support the market, sank 3 percent after no official action materialized.