BANGKOK - MOST Asian and European markets slid into the red on Wednesday as weak earnings from financial firms, lower commodity prices and concerns about ailing US automakers reinforced pervasive gloom about the global economy.

Japan's benchmark Nikkei 225 average fell 55 points, or 0.7 per cent, to 8,273.22 as investors digested a 64 per cent slump in first-half earnings at the country's biggest bank, Mitsubishi UFJ Financial Group.

In Australia, a major resources producer, the main index fell 0.7 per cent as crude oil traded near a 22-month low and metals prices fell overnight. Hong Kong's Hang Seng index declined 0.8 per cent to 12,815.80.

China bucked the trend with the Shanghai Composite Index surging 6.1 per cent to 2,017.47 as market heavyweight Petrochina rallied on expectations the government will allow fuel prices to be hiked next month.

A late-session rally on Tuesday on Wall Street - which pushed the Dow Jones Industrial average up 151.17 points, or 1.8 per cent, to 8,424.75 - failed to spur much enthusiasm in beaten-down Asian markets.

'It's looking pretty miserable at the moment', said Mr Song Seng Wun, head of research at CIMB Securities in Singapore.

'The question is how low the markets can go and whether previous bear market benchmarks such as the Asian financial crisis or the tech bubble are a reliable guide', Mr Song said.

'At this juncture, the safest bet is to be as defensive as possible, to find some where to take shelter and to wait and see'.

In Europe, London's FTSE 100 Index was down 2.4 per cent in opening trade, France's CAC-40 fell 2 per cent and Germany's DAX slipped 1.6 per cent.

US stock index futures were down, suggesting Wall Street would open lower on Wednesday. Dow futures were down 111 points, or 1.3 per cent, to 8,386 and S&P 500 futures were down 13.6 points, or 1.6 per cent, to 853.5.

Japan's Mitsubishi UFJ dived 6.4 per cent as the market reacted to grim earnings that were released after the close of trading on Tuesday.

The lender's first-half performance was battered by an increase in bad loans as economic activity slowed and by big losses on its share portfolio.

Uncertainty over the fate of a rescue plan for ailing US automakers also dampened market sentiment, said Mr Kazuki Miyazawa, a market analyst at Daiwa Securities SMBC in Toyko.

'It has turned into a political issue and looks unpredictable', he said.

Detroit's Big Three automakers begged Congress Tuesday for a US$25 billion (S$38.2 billion) lifeline to stay afloat. But the rescue plan appeared stalled, opposed by Republicans and the Bush administration unwilling.

Lower commodity prices hit several stocks in the region.

In Sydney, Woodside Petroleum fell 3 per cent as crude oil hovered at 22-month lows below US$55 a barrel in Asian trading.

BHP Billiton, the world's biggest miner, was off 4.1 per cent, and zinc producer Oz Minerals, which warned 2008 profit would fall because of 'substantially lower' commodity prices and higher production costs, plummeted nearly 14 per cent.

Gold for December delivery fell US$9.30 to US$732.70 an ounce on the New York Mercantile Exchange overnight and 3-month copper futures on the London Metals Exchange were down US$80 to US$3,590 per tonne.

In Singapore, commodities company Noble Group dived 13.8 per cent on the likelihood earnings will be hurt by sliding commodity prices as demand wanes in the face of a sharp downturn in global growth.

Neptune Orient Lines, Southeast Asia's largest container line, fell 3.4 per cent after revealing it will shed 1,000 workers because of an accelerating slowdown in global trade.

Earlier this week, the National Association for Business Economics in the United States forecast recessions in many of the world's major economies.

It said the US economy, which shrank at an annual rate of 0.3 per cent in the July-September period, would contract at a rate of 2.6 per cent in the current quarter.

The association also forecast that Canada, Mexico, Britain and much of Europe would all suffer recessions in the coming months.

Japan and the 15-nation euro zone have already entered recessions, defined as two consecutive quarters of contracting gross domestic product.

KUALA LUMPUR
Malaysian share prices closed 0.6 per cent lower on Wednesday as investors remained sidelined on the lack of positive news and sustained fears over the state of the global economy, dealers said.

The Kuala Lumpur Composite Index shed 5.44 points to close at 877.65.

SHANGHAI
China share prices surged 6.05 per cent on Wednesday as bargain hunters bought up energy stocks following sharp losses the previous day, dealers said.

The benchmark Shanghai Composite Index, which covers A and B shares, rose 115.04 points to 2,017.47 on turnover of 84.20 billion yuan (S$18.8 billion).

The Shanghai A-share index gained 120.79 points, or 6.04 per cent, to 2,119.28 on turnover of 83.9 billion yuan, while the Shenzhen A-share index rose 34.07 points, or 6.17 per cent, to 586.54 on turnover of 36.4 billion yuan.

HONG KONG
Hong Kong share prices closed 0.77 per cent down on Wednesday as dealers ignored a rise on Wall Street or stayed on the sidelines, analysts said.

The benchmark Hang Seng Index ended 100.09 points lower at 12,815.80.

Turnover was light at 38.91 billion Hong Kong dollars (US$7.67 billion).

TOKYO
Japan's Nikkei stock index closed down 0.66 per cent on Wednesday, weighed down by worries about the outlook for the US economy and a crisis engulfing its carmakers.

The benchmark lost 55.19 points to 8,273.22. -- AFP, BERNAMA, AP