Asian market preview 09/04/2008

US markets fell the most this month after disappointing reports from Alcoa and AMD and also from companies slashing Q1 profit forecasts. Washington Mutual, Intel, Novellus Systems, Freddie Mac and Fannie Mae are among those predicted to have lower earnings for Q1 and analysts downgraded the stocks. Pending home sales data came out worse than expected overnight added to the weight for markets. The Fed's minute for 18th March meeting showed that Fed's forecast that recession will happen in the first half of this year and it might be prolonged and more severe. Adding to the worry was that The Fed may not have enough room to have more interest rate cut to reduce the recession effect with the ever rising inflation globally. The Dow fell 35.99 pts or 0.29% to 12576.44, S&P500 fell 7 pts or 0.51% to 1365.54 while Nasdaq fell 16.07 pts or 0.68% to 2348.76.

Asian markets may open rather flat but with downside bias today. Markets may extend losses after more worrying news came out of the US overnight regarding corporate earnings as well as The Fed's recession fears. However, losses may be limited with US$ gained some grounds against major Asian currencies and energy & mining companies may support the markets today. Crude oil rose overnight and was recently traded around $108.80ish per barrel, gold was recently traded around $915.70ish and JPY weakened against US$ and was traded around 102.70ish. Nikkei futures was closed at 13360 at CME compared to the close of 13235 here yesterday.

The Kospi market is closed for public holiday today.

Hangseng may open around 24400ish and may have a rebound today following the profit taking action yesterday. However, market may still have some downside bias as more fears came out of the US overnight. Support level is at 24000 and if Hangseng able to breach that, it may move lower towards 23800ish. Resistance is at 24500 and it may go higher if Hangseng is able to go above that level.