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On the currency front, the U.S. dollar held firm in the lower 106-yen levels in late Tokyo deals, but it closed higher at 1,045.0 South Korean won. The Australian dollar closed firmer despite a fall in the nation's trade balance for May US$0.9626-0.9629 and the New Zealand dollar closed slightly higher at US$0.7596-0.7600.
The Japanese market closed lower for the eleventh straight trading session, recording the longest losing streak in more than half a century. After opening sharply lower the market recovered by late morning, but ended slightly below the flat line, ahead of the release of key U.S. jobs data and European Central Bank's policy meeting, after a choppy afternoon session.
The benchmark Nikkei 225 index lost 20.97 points or 0.16% to finish the session at 13,265.40. The Nikkei has shed nearly 1,200 points or over 8% during the past 11 trading days, its longest losing streak since late April 1954. The broader Topix index of all First Section issues on the Tokyo Stock Exchange closed down 3.13 points or 0.24% at 1,298.02.
On the economic front, data released by the Ministry of Finance showed that foreign investors became net sellers of Japanese stocks last week. It marked the first time in seven weeks that foreigners were net sellers. Foreign residents sold a net 516.3 billion yen worth of Japan stocks in the week ending June 28. Foreign investors were also net sellers of medium-to-long-term Japan bonds for the week, dumping 422.1 billion yen worth. It was the second straight week in which foreigners were net bond sellers.
Among major losers, Nippon Steel dropped 2.9% and JFE Holdings fell 3.9%. The weakness in steel sector also hurt trading houses. Mitsubishi Corp plunged 4.4%, Mitsui & Co lost 3.6% and Itochu Corp. gave away 3.2%.
Among shippers, Nippon Yusen lost 1.3%, Kawasaki Kisen fell 0.7% and Mitsui OSK Lines gave away 1.2%.
Major exporters either trimmed or erased early losses. Canon advanced 1.2%, Komatsu added 0.3% and Sony rose 0.9%, but Honda Motor shed 0.3%, and Toyota Motor lost 0.8%.
Bucking the trend, Mizuho Financial Group gained 2.3%, Mitsubishi UFJ Financial Group jumped 3.2% and Sumitomo Mitsui Financial Group advanced 2.1%. Top brokerage Nomura Holdings added 0.9%.
Oil and gas miner Inpex Holdings climbed 0.7% and Showa Shell added 2.5%, while Nippon Mining Holdings fell 2.1% and Nippon Oil slipped 0.6%.
Among other gainers, Pioneer surged 4.1% on reports that Sony's affiliate plans to buy its plasma panel plant in Kagoshima prefecture by end of the year and Sanyo Electric gained 3.4% after the company said that it would build a new plant for lithium ion batteries used in personal computers.
Heavy machinery builder IHI dropped 4.2% after the company recently decided to pay about 1.6 billion yen in fines for falsifying earnings report.
The South Korean market closed lower, but off early lows, with the KOSPI falling to near its 2008 lows on stagflation fears. The market has extended its losses for a sixth trading session.
The benchmark KOSPI index closed down 17.06 points or 1.1% at 1,606.54 after falling below the 1,600 mark for the first time in almost three months in early trade. The benchmark index has dropped more than 6% during the six-day losing streak and is now about 15% below its 2008 best seen in mid-May.
South Korea Wednesday trimmed sharply its growth forecast for this year to below 5% as skyrocketing oil prices and the global economic slowdown combined to pose a serious threat to the local economy. The growth downgrade came a day after the nation's central bank lowered its growth projection to 4.6% from 4.7%.
Meanwhile, the government said Wednesday that the number of industrial plant orders won by South Korean companies shot up in the first half as oil-rich countries used extra earnings from skyrocketing crude prices to build infrastructure. According to the Ministry of Knowledge Economy orders for offshore facilities, desalination and petrochemical plants as well as other industrial infrastructure rose 30.5% on year to US$23.1 billion in the first six months of 2008.
Automakers fell after General Motors slumped overnight. Hyundai Motor tumbled 4.5% and Kia Motors fell 2.6%.
Among steelmakers, POSCO plunged 6.3% amid worries over costlier raw materials, including iron ore. Hyundai Steel dropped 5.3%.
Daewoo Shipbuilding & Marine Engineering fell 2.7% following government's plan to limit corporate loans used for M&A. Hyundai Heavy Industries lost 3.1%.
However, high-tech stocks rebounded following recent losses. Samsung Electronics gained 0.5% and Hynix jumped 5.5%.
Korean Air Lines plummeted 4.2% and smaller Asiana Airlines shed 4.5%, while shipper Hanjin Shipping declined 2.8%.
The Chinese market extended its gains on Thursday, following a broad recovery among blue chips. The Shanghai Composite Index gained 51.80 points or 1.95% to finish at 2,703.53.
The market ended a four-day losing streak on Wednesday, recording a modest recovery after the key index lost nearly 50% of its value so far this year as the worst performing market in the world.
Real estate, banking and metal sectors posted strong gains.
Among developers, Shimao Property surged by the daily cap of 10.0% and China Vanke added 1.0%. Banks rebounded, with Industrial and Commercial Bank of China adding 0.4%.
Xinjiang Ba Yi Iron & Steel surged by the daily limit of 10.0% after the company said that its first-half profit may have jumped more than threefold due to higher metal prices.
China Petroleum & Chemical Corp rose 0.4% and index heavyweight PetroChina advanced 0.7%.
Beijing Yanjing Brewery climbed 4.7% after the company said that it has won regulatory approval for a plan to sell as much as 1.8 billion yuan of shares to upgrade production lines and build barley processing plants.
Inner Mongolia Eerduosi Cashmere Products jumped 7.1% after the wool producer said Wednesday that its first-half profit probably more than doubled because earnings from one of its subsidiaries increased.
Bucking the trend, Ping An Insurance fell 5.8% after the company said that some investors were speculating about a tax investigation.
The Australian market fell to near two-year lows on concerns that record oil prices would hurt global economic growth. After a gap-down opening, tracking Wall Street's fall overnight, the market recovered marginally going into the close of the trading session as some investors sought buying opportunities.
The market has extended its losses for a fifth straight trading session, with the key S&P/ASX 200 index falling below the 5,000 mark for the first time since September 2006. Additionally, the key index has lost 27% from the high of 6,827.1 hit on November 11, 2007.
The benchmark index finished the session at 4,998.3, down 96.5 points or 1.9%, while the broader All Ordinaries index closed down 117.6 points or 2.3% at 5,094.0.
On the economic front, the Australian Bureau of Statistics said that the trade deficit was a seasonally adjusted A$965 million in May, following a large upward revision to A$12 million surplus in April. Economists expected a deficit of A$950 million in May.
Meanwhile, the Australian Industry Group/Commonwealth Bank Performance of Services Index for June fell 4.3 points to a reading of 45.4, marking its lowest level since the series began in February 2003.
However, new vehicle sales in Australia jumped 6.3% on seasonally adjusted terms in June, despite a surge in fuel prices. Monthly data from the Australian Federal Chamber of Automotive Industries showed that sales rose 20.2% in original terms in June, following falls in April and May.
Top miners dragged the market down. BHP Billiton slumped 7.2%, takeover target Rio Tinto tumbled 7.8% and Fortescue Metals Group plunged 12.0%.
Coal miners were among the biggest decliners, following a fall in their U.S. and London counterparts, after coal prices fell overnight. Major losers included Centennial Coal 13.5%, Macarthur Coal 7.7% and Riversdale Mining 11.8%.
Gold miner Newcrest Mining fell 3.3% after closing out its gold hedge book at a cost of A$1.67 billion. Lihir Gold dropped 3.0%.
In the energy sector, Woodside Petroleum plunged 3.9%, Santos lost 3.0% and Oil Search slumped 7.5%. In electronic trading, crude oil held near the fresh record of $144.32 a barrel hit on Wednesday in U.S. floor trading. Oil settled down at $143.57 a barrel overnight.
Among retailers, Wesfarmers slumped 4.8% and Woolworths lost 1.1%. Just Group advanced 4.3%, bouncing back from Wednesday's 12.6% slump after the retailer cut its 2008 earnings forecast.
Bucking the trend, banks closed in positive territory. Commonwealth Bank rose 2.8%, ANZ climbed 2.2%, National Australia Bank advanced 1.8% and Westpac Banking Group added 2.0%. St George Bank moved up 1.2% and investment bank Macquarie Group gained 0.6%.
Among news driven stocks, AWB surged 6.6% after JP Morgan upgraded its rating on AWB to neutral from underweight, QBE jumped 3.1% following a rating upgrade by Citigroup and Ten Network Holdings surged 6.3% after it announced plans to buyback up to 10% of its issued shares over the next 12 months.
The New Zealand market extended its losses for the fifth straight trading session, hitting a fresh three-year low. After opening lower the market continued to lose ground and closed near the day's lows. The benchmark NZX50 index closed down 68.97 points or 2.23% at 3,094.42. The key index slumped a whopping 12% in June. The broader NZX All Capital index fell 77.70 points or 2.48% to finish at 3,127.73.
On the economic front, a survey by ANZ showed that the commodity prices remained flat in June in New Zealand, following a 0.9% increase in May. The indicator remained unchanged for the first time since December 2007. On an annual basis, commodity price growth eased to 11.6% from 18.7% in May.
Meanwhile, the ANZ New Zealand Dollar Commodity Price Index rose 2.1% month-on-month in June, compared to a 2.5% increase in May. The annual growth came in at 12.5%, down from 13.2% in May.
Top stock Telecom plunged 3.2%, the second-ranked Contact Energy lost 2.2% and Fletcher Building dropped 1.7%. In the retail sector Hallenstein Glasson plunged 4.2%, Pumpkin Patch fell 2.1% and The Warehouse Group tumbled 4.1%. Michael Hill closed unchanged. Among energy stocks, Vector closed flat, while TrustPower plummeted 3.7%.
Other major losers included Auckland Airport and Fisher & Paykel Appliances 2.6% each, Fisher & Paykel Healthcare 4.3%, Goodman Property Trust 2.5%, Infratil 4.8%, Nuplex and Sky City 2.9% each, New Zealand Oil & Gas 6.6%, Port of Tauranga 3.8% and Tourism Holdings 3.6%. Pike River Coal slumped 8.3% following big falls in international coal prices overnight.
Bucking the trend, Air New Zealand rose 0.9% after the airline increased airfares across many of its routes, for tickets bought from July 17, on rising jet fuel prices. ING Property Trust and New Zealand Farming Systems advanced 1.1% each and Telstra added 0.8%.
Among other markets in the region, Hong Kong's Hang Seng index closed down 2.1% at 21,242; Singapore's STI closed down 0.9% at 2,880; Taiwan's weighted index closed up 0.55% at 7,394; Malaysia's KLCI lost 0.7% to 1,145; and Indonesia's Jakarta composite index closed down 3.9% at 2,286. India's Sensex slumped 4.2% to close at 13,094.
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