Asian market preview 28/03/2008

US markets fell for 2nd day overnight following the GDP and jobless claims data. Q4 2007 GDP was at 0.6%, in line with analysts' expectations but it showed that the economy has contracted so much compared to the 4.9% growth rate the previous quarter. Jobless claims has unexpectedly decreased by 9000 to 366000 but analysts believe that unemployment is expected to rise this year given the current economic conditions. Markets also fell as concern that profit growth will weaken for financials and technology companies. Oracle Corp. tumbled after its revenue trailed analysts' estimate and Google Inc. also slid after the search engine received fewer ad click. However, consumer spending in Q4 rose higher than expected to 2.3% and sales of US goods and services to other countries grew 6.5% due to declining dollar. The Dow fell 120.40 pts or 0.97% to 12302.46, S&P500 fell 15.37 or 1.15% to 1325.75 while Nasdaq tumbled 45.53 pts or 1.87% to 2280.83. Despite of the decline, there seems to be a different mindset among traders right now and people are buying on weakness as long as there is no other Bear Stearns out there.

Asian markets may start the day slightly lower today tracking the US decline overnight. However, many analysts believe that there might be Window dressing in session for today before the last day of March on Monday. Crude oil price rose again to above $107 overnight after a pipeline fire in Iraq cut supplies. Crude oil was recently traded around $107.30ish per barrel, gold was recently traded around $948.90ish and JPY traded around 99.60ish. Nikkei futures was closed at 12700 compared to the close of 12745 here yesterday.

The Kospi may start the day slightly lower around 214ish today following the decline in Wall St overnight. However, decline may be limited should foreign investors decided to come in and buy stocks in South Korea. US economic data was not as bad as predicted as the economy still grow but at a very small rate according to the GDP data and the downside trend may only be dominated by profit taking by nervous investors.

Hangseng may pullback at the open to around 22650ish for the new contract tracking the US markets overnight. There may be some profit taking to take place today after a series of strong gains for the past 3 days for Hangseng. If Hangseng can breach the 22800 level, it may even try and go towards 23000 today. There may be a chance that a window dressing session may take place too today before the end of March to make the shares look better.