Asian market preview 03/09/2008

US markets erased sharp gains in early trade to close moderately lower last night. Oil prices became the main reason for markets' activity for last night's trade where crude oil fell to as low as $105.46 per barrel. However, the positive impact from the falling oil was short-lived on stocks as commodity producers and more worries in housing and financial sector weighed on the overall market. There is a high level of uncertainty in the market which caused high volatility like we saw the past few months. ISM said its index on manufacturing activity fell to 49.9 in August from 50 in July as expected. Crude oil ended the day falling $5.75 to settle at $109.71 per barrel as fears of new storm brewing. Financials and airlines led the markets higher last night while tech sector was dragging the overall market. The Dow ended down by 26.63 pts or 0.23% to 11,516.92, S&P500 fell 5.25 pts or 0.41% to 1,277.58 while Nasdaq fell 18.28 pts or 0.77% to 2,349.24.

Asian markets may open around yesterday's closing numbers today following the weak close on Wall St. However, markets sentiment around the region may be positive today as oil prices fell by a quite a large amount and was traded below $110 since April. The cheaper oil eased inflationary concerns around the region but more uncertainties regarding the whole global economy may also drag the markets down today. Oil was recently traded around $110.20ish per barrel, gold traded around $809.40ish and JPY traded around 108.68ish. Nikkei futures was closed at 12680 in CME last night compared to the close of 12755 here yesterday.

Kospi may open rather flat with higher bias in early trade today as falling crude oil may spur some buying interests for investors. However, the continued decline in the Won currency may still weigh on the market unless the government really going to do something about it. Bargain hunters may kick in as the market have been badly battered for the past few weeks. Volatility may be high as the market try to grapple with positive news of falling energy prices and the negative news of the overall economic stability. Kospi may find its support at 180 today and its resistance at 186ish.

Hangseng may open higher today on lower oil price cues and may extend yesterday's rally. The continued decline in oil prices may help the market as it gave some hope to investors that inflation problem is easing slowly. However, as there are more storms to come in the US, oil may creep back up and may weigh on the market yet again. China markets may play a part in determining how well Hangseng market may perform today. Hangseng may find its support at 20800ish and its resistance at 21400ish today.