Asian market preview 31/10/2008

US markets closed higher last night in a relatively calm trading session after GDP reports showed better-than-expected results. Last night's trading session was less erratic compared to the previous sessions this month where markets swung in 500 points range. The Commerce Dept reported that GDP fell at an annual rate of 0.3 compared to the decline of 0.5 expected by analysts. However, the measure still pointing to an economy contraction in Q3 and analysts are predicting that high market volatility will continue on for several months. Investors still remained cautious about the whole economic outlook and corporate earnings may remain grim for sometime. If earnings report showed more negativity, investors may test markets' low again and heavy sell-offs can be seen in the coming months. The Dow ended up by 189.73 pts or 2.11% to 9,180.69, S&P500 rose 24.00 or 2.58% to 954.09 while Nasdaq rose 41.31 pts or 2.49% to 1,698.52.

Asian markets may open rather flat today following the mild rise on Wall St last night on better GDP report. Asian markets may continue its rally today but may not rise as much and may even have a profit taking session after 3 days of huge rallies. Cautious investors may take their recent winnings off the table as GDP report in the US still showed that economy is contracting though not as bad. Oil prices also declined as economy slows in the US. Oil was recently traded around $65.65ish per barrel, gold traded around $738.50ish and JPY traded around 98.70ish. Nikkei futures was closed at 9020 in CME compared to the close of 9025 here yesterday.

Kospi may open rather flat with an upward bias in the morning and building from its huge rally yesterday after recouping its losses the day before on false rumor. Kospi may extend yesterday's rally but may also give up its rally later on in the day. Profit taking may take place towards market close as weekend is around the corner and investors may want to take recent winnings off the table. Kospi may find its support at 136ish and its resistance at 145ish today.

Hangseng may open higher today following the rise in US markets and good earnings report so far. However, bad earnings from Bank of Communications may cause investors to have a profit taking session today after recent run ups which took Hangseng up by more than 20% in 3 days. Investors may turn cautious again today ahead of the weekend and may lock in recent gains. Hangseng may find its support at 13500ish and its resistance at 14300ish today.