HONG KONG - ASIAN stock markets faltered Wednesday, with Japan's benchmark losing 1.3 per cent, as evidence mounted that a worsening global economy has taken a toll on companies. European markets opened higher.

Tokyo's Nikkei stock average slid 146.11 points to 8,663.19, and Hong Kong's Hang Seng Index fell 101.81 points, or 0.7 per cent, to 13,939.09.

Taiwan's benchmark retreated 0.5 per cent as the country's former president was ordered held on corruption charges. Singapore, South Korea and Australia benchmarks also fell.

'The markets are more pessimistic today', said Mr Dariusz Kowalczyk, chief investment strategist at CFC Seymor in Hong Kong.

'It is evident that recession is having a detrimental impact on demand, prices, sales and profits'.

As trading opened in Europe, benchmarks in Germany, France and Britain were about 2 per cent higher. Russia's dollar-denominated index was down sharply.

Investors in Asian equities found few reasons to buy after Wall Street pulled back as it became clear that slowing consumer demand was hitting a wide cross-section of companies.

Starbucks reported lower sales across the coffee chain, homebuilder Toll Brothers posted a sharp drop in revenue and said it was to difficult to forecast next year's results. Aluminum producer Alcoa announced production cuts due to lower prices.

Corporate Asia only added to the gloom as leading Japanese energy explorer Inpex cut its forecasts amid slumping oil prices and a stronger yen.

There were also signs that Chinese shoppers were holding back after figures showed a softening in the country's retail sales in October compared with a year earlier.

There was also caution ahead of this weekend's summit of leaders from 20 major economies in Washington, where they will discuss how to tackle the global financial crisis.

'People are wondering if their expectations for the G20 are met or exceeded,' said Mr Fumiyuki Nakanishi, chief equity strategist at SMBC Friend Securities in Tokyo.

'But there is so much uncertainty at this point'.

Bucking the regional decline, the benchmark Shanghai Composite Index added 0.8 per cent to 1,859.11 as the country's US$586 billion (S$882 billion) stimulus plan continued to lift sentiment.

In Japan, a grim outlook for the US economy continued to drag on exporters such as automakers and consumer electronics firms.

Nissan Motor fell 5 per cent, and Canon was off 3.5 per cent.

A drop in commodities and crude oil prices added to anxieties about slowing global growth. Oil prices were hovering near 20-month lows, with light, sweet crude for December delivery down US$1.13 to US$58.24 a barrel in electronic trading on the New York Mercantile Exchange by late afternoon in Singapore.

Inpex, Japan's top natural resource developer, fell 5.4 per cent, after it cut its full-year net profit forecast by 15 per cent on Tuesday. Australia's BHP Billiton retreated 1.7 per cent.

In currencies, the US dollar strengthened to 97.85 yen from 97.16 yen. The euro stood at US$1.2630 from US$1.2483.

Overnight in New York, the Dow Jones industrial average shed 176.58, or 2 per cent, to 8,693.96 after falling by more than 300.

Tuesday's close was the Dow's lowest since its 5 1/2-year closing low on Oct 27 of 8,175.77.

US stock futures were up slightly, suggesting Wall Street would open higher on Wednesday. Dow futures were up 21 points, or 0.2 per cent, at 8,656.

KUALA LUMPUR
Malaysian share prices closed 0.4 per cent lower on Wednesday as investors took profit amid bearish market sentiment, dealers said.

The Kuala Lumpur Composite Index was down 4.26 points to closed at 890.34.

HONG KONG
Hong Kong share prices closed 0.7 per cent lower on Wednesday, trimming earlier losses as investors began to hunt for bargains following gains on the Shanghai bourse, dealers said.

The benchmark Hang Seng Index closed down 101.81 points at 13,939.09.

Turnover was light at 47.24 billion Hong Kong dollars (S$9.11 billion).

'There are still a lot of uncertainties but China plays are still attracting investors' interest as they are relatively less affected by the global economic slowdown concern', Mr Jackson Wong, analyst at Tanrich, told Dow Jones Newswires.

SHANGHAI
Chinese share prices closed up 0.84 per cent on Wednesday as residual effects from the government's multi-trillion yuan stimulus package sparked a rally in construction-related stocks, dealers said.

The benchmark Shanghai Composite Index, which covers A and B shares, closed up 15.50 points to 1,859.11 on turnover of 41.0 billion yuan (US$9 billion).

The Shanghai A-share index added 16.26 points, or 0.84 per cent, to 1,952.98 on turnover of 40.9 billion yuan, while the Shenzhen A-share index gained 7.65 points, or 1.47 percent, to 527.42 on turnover of 19.3 billion yuan.

TOKYO
Japan's Nikkei stock index finished down 1.29 per cent on Wednesday as worries about plunging corporate profits and the weak global economy weighed on sentiment.

The benchmark dropped 113.79 points to 8,695.51, after the Dow Jones index ended down 1.99 per cent overnight on Wall Street. -- AFP, BERNAMA, THOMSON REUTERS