Asian market preview 23/05/2008

US markets posted a modest increase last night after oil drops more than $2 though it rose to slightly above $135 per barrel. The drop in jobless claims also boosted the overall market. Jobless claims drop 9000 to 365000 compared to an estimated increase by analysts. It showed that companies are doing the right thing to help the economy where they're cutting back hiring instead of firing more existing employees. Almost all industries rose in the market and even the financial sector also rallied last night. Utilities rose as more investors turn to this sector as defensive measures in these uncertain times. The Dow increase by 24.43 pts or 0.19% to 12625.62, S&P500 rose 3.64 pts or 0.26% to 1394.35 while Nasdaq rose 16.31 pts or 0.67% to 2464.58.

Asian markets may open higher today following US cues and after having a mixed session yesterday. The drop in oil prices may show that the recent rally is quite unjustified and it may give some assurance to investors that the current economic condition may get better later this year. Crude oil was recently traded around $130.93ish per barrel, gold traded around $919.90ish and JPY traded around 104ish. Nikkei futures was closed at 14020 in CME last night compared to the close of 13965 here yesterday.

Kospi may open around 236-237 today with a slight upward bias. It may go up towards 239ish as the first resistance and tech sector may give support to the market. With the first decline in oil after a few days of rally, foreign investors may start buying again and bargain hunters may kick in as the index have fallen more than 2% this week. However, limited upside may still remains as there are still more uncertainties in the market.

Hangseng may open slightly higher around 25000 today following US cues last night. China market may play a significant part to determine whether Hangseng will recoup its losses or whether it will have another rough day of ups and downs again today. Bargain hunters may kick in and start buying stocks to get the market well above the psychological 25000 level again. Hangseng may find 25200 as its first resistance and may find support around 24700 today. The futures market was at a 100 pts discount to the cash market at the close yesterday.