Asian market preview 02/06/2008

US markets ended a strong week with a mixed performance on Friday after government's report showed that Americans' spending rose in April to keep pace with rising costs. Commerce department reported that personal spending rose 0.2% and personal income rose 0.2%. Inflation at personal spending level excluding food and energy costs, rose by a small amount of 0.1% in April. These readings were in line with expectations and showed that high commodities costs have not yet caused sharp pullback in spending or lifting prices for other goods. More data to come out this week for investors to digest and use them to gauge the health of the economy. One of these is the employment report and manufacturing. Good data on these items may boost stocks further or a bad data may cause another sharp pullback. The Dow ended down by 7.90 pts or 0.06% to 12638.32 and rose 1.27% for the week. S&P500 rose 2.12 pts or 0.15% to 1400.38 and gained 1.78% for the week. Nasdaq rose 14.34 pts or 0.57% to 2522.66 and gained 3.19% for the week.

Asian markets may open flat after US markets ended the session pretty much flat on Friday with investors turned cautious. High oil prices may still weigh on the investors and more uncertainties regarding the US economy may provide a good time for some investors to reap quick profits after the markets rose quite a lot in the past 2 sessions. Oil was recently traded around $127.39 per barrel, gold traded around $886.20ish and JPY traded around 105.35ish. Nikkei futures was closed at 14380 in CME compared to the close of 14370 here on Friday.

Kospi may open the session flat with some downside bias today. It may go down first in the morning before continuing its rally if investors are still positive about the market. However, lack of fresh new momentum may drive the market lower today with investors lock in profits. Trading range maybe thin today with volatility may be high as profit taking may be up against bargain hunters.

Hangseng may open around 24500ish and may be trading within 24000-24500 today. Volatility may be high and lack of strong market news from the US may drive Hangseng lower today on profit taking. If Hangseng is able to break 24570, it may try to go towards 24700 but if it go down, 24000 may be a very strong support point. China mainland markets may yet again determine how strong or how weak the Hangseng market is going to be.