Asian markets mostly lower as oil prices rebound

Trading volume in Hong Kong was relatively thin, suggesting the market could see more downside, analysts said.
Chinese commodity producers were also hit, with China Coal dropping 4.33 per cent and Angang Steel falling 3.77 per cent.

In China, the key Shanghai Composite Index fell 5.3 per cent to 2,319.87 - its lowest close in 20 months - amid a sweeping sell-off of large-capitalized airlines, refiners and other financial shares. Analysts said the sell-down reflected disappointment over a lack of new market support from the government.

Online comments seen Monday that summarized a weekend discussion between government regulators and reporters for state-run media suggested the authorities ``would not take any move to save the market,'' said Zhai Peng, an analyst at Guotai Junan Securities in Shanghai.

``Obviously, the market was very disappointed with this,'' Zhai said. ``This is far below investors' expectations.''
Airlines, which reported falling passenger traffic last month partly due to visa restrictions related to the Olympics, were among the biggest decliners. China Southern Airlines dropped 9.9 per cent, while rivals Air China and China Eastern Airlines both plunged by the 10 per cent daily limit.

Shanghai's biggest listed share, PetroChina, dropped 4 per cent and Petroleum & Chemical Corp., or Sinopec, slumped 6 per cent.

The market has also suffered from liquidity pressure as billions of newly tradable shares have begun trading this month. The strain was seen in the relatively modest performance by China Southern Locomotive, whose 3 billion shares began trading Monday in Shanghai after an initial public offering that, along with a dual listing in Hong Kong, raised nearly US$1.5 billion.

China Southern Locomotive's shares peaked at 83 per cent above their IPO price of 2.18 yuan in early trading but later fell back, closing at 3.45 yuan - or 58 percent higher than the IPO value.

Elsewhere, Taiwan's benchmark lost 2.7 per cent, South Korea's Kospi slipped 0.3 per cent and India's Sensex index was 0.5 per cent lower.

In currencies, the dollar stayed steady against the yen Monday, trading at 110.24 yen in the afternoon from 110.49 yen late Friday. The euro bought US$1.4719 compared with US$1.4687.