Houston Community News >> Asian Markets Subdued After Greenspan Warning

5/23/2007 HONG KONG - Asian stock markets slipped on Thursday after former U.S. Federal Reserve Chairman Alan Greenspan warned of a "dramatic contraction" in Chinese stocks, fanning concerns about China's red-hot markets.

Greenspan told a teleconference in Madrid that the boom in Chinese stocks could not last. His comments followed a string of recent warnings about the mainland markets from influential people such as Asia's richest man Li Ka-Shing.

China's benchmark Shanghai Composite Index has climbed 56 percent so far this year and has nearly tripled in value since last May as investors piled into a bull market stoked by robust economic growth.

At 0025 GMT, Tokyo's Nikkei average had eased 0.2 percent as recent gainers lost ground. Sony shed 1.3 percent and consumer credit firm Credit Saison fell 2.7 percent.

Japan's Mitsubishi UFJ Financial Group (MUFG) lost 1.4 percent a day after the world's biggest bank by assets reported a 25.5 percent drop in annual profit and said earnings would likely decline further this year.

"The market is likely to take a breather after rising three sessions in a row and also following a fall in U.S. stocks," said Hiroichi Nishi, a general manager of equity marketing at Nikko Cordial Securities.

In Australia, falls of 0.7 percent for mining giant BHP Billiton, 0.6 percent for Commonwealth Bank and 1.6 percent for steel maker BlueScope Steel knocked 0.7 percent off the benchmark S&P/ASX 200 index.

But Qantas Airways edged up 0.2 percent after the firm said it was considering a de-merger and share buyback as part of a capital management review following the collapse of a takeover bid for the airline.

MSCI's measure of Asia Pacific stocks excluding Japan slipped 0.24 percent, a day after setting yet another record closing high.

Markets in Hong Kong and South Korea were closed on Thursday for public holidays.

(Contributed by Reuters)