Asian market preview 05/06/2008

US markets ended mixed overnight as concerns about the financial sector eroded enthusiasm over a decline in oil prices and a report that signaled modest growth in the service economy. The Fed's chairman, Bernanke's comments on inflation in the US is being above the comfort zone also caused the markets to go down after it rises in the morning. ISM manufacturing index and ADP jobs report came better than expected and those data sent markets soaring higher in the morning. Oil prices declined more than $2 and was settled at $122.30 per barrel after supply came out more than expected in the US. Financial sector was hammered yet again last night after Moody's investor service warned it might downgrade the ratings on Ambac and MBIA. The Dow ended down by 12.37 or 0.1% to 12390.48, S&P500 fell 0.45 pts or 0.03% to 1377.20 while Nasdaq rose 22.66 pts or 0.91% to 2503.14. Tech sector rallied overnight as investors turned to tech sector as they believed that the sector is quite safe compared to the other sector in the market which can be affected by credit crisis.

Asian markets may open quite flat today with some upward bias boosted by the tech sector today. The decline in oil may also helped boost stocks like yesterday but more uncertainties in financials may make the markets around the region to be volatile. The strength in Dollar may boost exporters yet again. Stocks may go down too with investors may want to take out their money in these uncertain times. Oil was traded recently around $122.30ish per barrel, gold traded around $876.90ish and JPY traded around 105.24ish. Nikkei futures closed at 14340 in CME last night compared to the close of 14250 here yesterday.

Kospi may open a bit flat today at around 235ish and may have a rough volatile session today with more uncertainties in the US with inflation problem and more credit crisis concerns on the financials front. Lower crude oil may help markets today and the tech sector may boost the market higher along with exporters. Investors may not buy heavily into the stock markets ahead of the long weekend though and that may cause quite a high volatility rate.

Hangseng may open around 23900-24000ish today after being heavily sold towards the end of the session yesterday. The selloff in Chinese telecoms and CNOOC yesterday have caused the futures market to go below 24000 level. Market may see into China market yet again today to determine whether the market may get a nice rebound or more downside today. Chinese telecoms may still be in focus today and also oil producers. Oil refiners such as Sinopec and PetroChina may get a boost after oil price keep declining. Hangseng may find 23700 as its support today and 24200 as its resistance today.