Asian market preview 30/06/2008

US markets were tumbling down yet again on Friday and The Dow is on the brink of a bear market after shedding more than 100 pts for 2 consecutive days. Negative sentiment from investors came after more bad news from the financial sector. Morgan Stanley is being reviewed by Moody's for a possibe downgrade and there were reports saying that Merril Lynch might have to write off nearly $6 billion of risky debts. In addition to these troubling news, investors also watched how oil marched higher and touched a record high of $142.99 per barrel. Economic data released on Friday came out slightly better but could not boost investors' mood. Commerce Dept said that spending rose 0.8% in May, as taxpayers received their stimulus checks. Personal income also rose 1.9%, much better than anticipated. June's index of consumer sentiment came in at 56.4, a bit lower than May's and below analysts' estimate. On Friday, the Dow fell 106.91 pts or 0.93% to 11346.51, S&P500 fell 4.77 pts or 0.37% to 1278.38 while Nasdaq fell 5.74 pts or 0.25% to 2315.63.

Asian markets may open lower yet again on Monday following more bad news which came out of the US on Friday which caused the US markets to have another rough session. Investors' sentiment may be low and they may not want to enter the market yet although the current share prices can be considered quite low. Many Asian markets will be watching the inflation report to come out this week in their countries and also the rate decisions to be made by respective central banks. The ever rising oil prices may also weigh further on investors as higher oil means higher inflation. Oil was recently traded around $140.20ish per barrel, gold traded around $926.70ish and JPY traded around 106.15ish. Nikkei futures closed at 13540 in CME compared to the close of 13440 here on Friday.

Kospi may open lower today at around 215ish following the string of bad news to come out of the US on Friday. However, buying power may slightly emerge for long-term players if the index fell too much. Cautious trading may be in focus this week when valuable economic data to come out from South Korea.

Hangseng may also open lower today at below 22000. However, as we have seen on Friday, buying power have slightly emerged from investors as share prices look quite attractive now at current level. China market may also play a big part to determine whether Hangseng have the strength to rise or should it fall further. Hangseng may find its support at 21700ish and its resistance at 22200ish today.