SEOUL - MOST Asian stock markets fell on Monday on signs that the US holiday shopping season got off to a tepid start over the key Thanksgiving weekend. Major European markets opened lower.

Investors seemed to want a breather to reassess after rallies in global markets last week, including the first five-day advance for Wall Street since July 2007. Some traders wanted to hold back ahead of the Institute for Supply Management's November manufacturing survey due later Monday for further clues about the strength of US economy, a vital export market.

Investors are bracing for more bad news about the US economy, said Tsuyoshi Nomaguchi, a strategist for Daiwa Securities in Tokyo.

'They aren't sure what they're supposed to do at this point,' he said.

India's benchmark Sensex index reversed early gains, falling 1.5 percent per cent to 8,955.08 in the wake of the terrorist attacks in Mumbai that left 172 people dead.

In Tokyo, the benchmark Nikkei 225 stock average lost 115.05 points, or 1.4 per cent, to close at 8,397.22 after advancing 7.6 percent last week. Investors sold exporters as the yen strengthened, which erodes their overseas earnings.

Markets in South Korea, Australia and Singapore also fell.

Bucking the trend were Hong Kong and mainland China, where key indices rose on expectations of further measures by the Chinese government to boost the economy after last month's big interest rate cut and announcement of a multi-billion dollar stimulus package.

Hong Kong's Hang Seng index closed up 220.60 points, or 1.6 per cent, to 14,108.84, continuing its rally from last week, when it rose nearly 10 per cent. China's Shanghai Composite index gained 1.3 per cent to 1,894.61.

'These are the appetizers of a full meal,' said Winson Fong, managing director at SG Asset Management in Hong Kong, which overseas about US$3 billion (S$4.5 billion) in equities in Asia, referring to those earlier measures.

Early reports from the US showed modest gains in retail sales on Black Friday - the traditional start of the American holiday shopping season - but business appeared to fall off during the rest of the weekend, at least according to some accounts, and analysts said crowds were thinner than last year. Also, sales gains seemed to come at the expense of profits as companies slashed prices to lure shoppers.

Investors around the world are paying close attention to the weekend sales figures for clues on the strength of the American economy, a vital export market.

According to preliminary figures released Saturday by ShopperTrak RCT, a research firm that tracks total retail sales at more than 50,000 outlets, sales rose 3 per cent to US$10.6 billion on Friday from the same day a year ago. A more complete sales picture of how the Thanksgiving shopping weekend fared won't be known until Thursday when the nation's retailers report November same-store sales, or sales at stores opened at least a year.

'We don't know if it's driven by sales or if US consumers are getting their confidence back,' said SG Asset Management's Fong.

As trading opened in Europe, the FTSE 100 index of leading British shares fell 1.5 per cent at 4,225.49. Germany's DAX was 1.8 per cent lower at 4,584.37 and France's CAC-40 slipped 1.4 per cent to 3,216.44.

Stocks in Thailand reversed early gains as investors weighed prospects that the country's political crisis will be resolved soon.

Anti-government protesters have occupied Bangkok's two main airports for nearly a week, cutting off air freight, stranding tourists and crippling the economy. The benchmark SET index was down 1.7 per cent at 394.80.

US stock futures were down, suggesting Wall Street would open lower Monday. Dow futures were down 96 points, or 1.1 per cent, to 8,724, and S&P futures were up 12.9 points, or 1.4 per cent, to 882.4.

Oil prices fell to below US$52 a barrel after Opec declined to cut production at an informal meeting in Cairo on Saturday. Light, sweet crude for January delivery was down US$2.54 to US$51.89 a barrel in electronic trading on the New York Mercantile Exchange in mid-afternoon in Singapore.

Chinese industry slumps
A gauge of manufacturing activity in China showed the sharpest monthly contraction in its 4-1/2-year history on plunging new orders for export goods.

Market players are looking ahead to a batch of closely watched figures in the United States this week, with the Institute for Supply Management's factory index expected to show activity shrinking at the fastest pace since the early 1980s.

Improved fund flows into equities may help buoy beleaguered Asian currencies. The South Korean won edged up slightly to 1,463.9 despite the downbeat trade figures.

The yen edged up as investors trimmed higher-yielding currencies. The dollar dipped 0.2 per cent to 95.30 yen (S$1.52), while the Australian dollar shed 1 per cent to US$0.6484 and 0.9 per cent to 61.77 yen.

Safe-haven government bonds slipped after gains in most stock indexes.

The 10-year Japanese government bond yield rose half a basis point to 1.395 per cent, while short-term yields fell on expectations the Bank of Japan would undertake more measures to help the battered money market.

KUALA LUMPUR
Malaysian shares closed 2.0 per cent lower on Monday on profit taking as sentiment remained fragile due to a lack of fresh leads, dealers said.

The Kuala Lumpur Composite Index dropped 17.71 points to end the day at 848.43.

At 5.00 p.m. today, there were 153 gainers, 345 losers and 176 counters traded unchanged on the Bursa Malaysia.

The KLCI was at 848.43 down 17.71 points, the FBM2BRD was at 3,990.60 down 40.00 points, and the FBMEmas was at 5,566.84 down 108.73 points.

Turnover was at 3.961 million lots valued at RM740.392 million.

SHANGHAI
Chinese shares closed up 1.25 per cent on Monday led by bargain-hunting for property shares and news that China Merchants Property Development successfully sold 450 million new shares, dealers said.

The benchmark Shanghai Composite Index, which covers A and B shares, closed up 23.46 points at 1,894.62 on turnover of 52.2 billion yuan (S$12 billion).

The Shanghai A-share index rose 24.49 points, or 1.25 per cent, to 1,989.67 on turnover of 52.0 billion yuan, while the Shenzhen A-share index was up 15.96 points, or 2.81 per cent, to 583.35 on turnover of 26.1 billion yuan.

HONG KONG
Hong Kong share prices closed 1.6 per cent higher on Monday, outperforming other Asian markets on the back of optimism about moves to boost the Chinese economy, dealers said.

The benchmark Hang Seng Index ended the session 220.60 points higher at 14,108.84. Turnover was 43.93 billion Hong Kong dollars (S$8.58 billion).

Chinese shares pulled the index higher, boosted by Beijing's recent aggressive efforts to stimulate the mainland economy.

Dealers said the moves had attracted investors searching for any positive signs amid a dismal global outlook.

TOKYO
Japanese shares ended lower on Monday, hit by a stronger yen and profit-taking ahead of US economic data and interest rate decisions in Europe due later in the week.

The benchmark Nikkei-225 index dropped 115.05 points or 1.35 points to finish at 8,397.22. The broader Topix index of all first section issues lost 7.35 points or 0.88 percent to end at 827.47.

'It's time for another downturn,' said Mr Hideaki Higashi, a strategist at SMBC Friend Securities. 'Investors are selling, anticipating a correction after the string of advances.'

Markets were jittery ahead of US data including a manufacturing index due later on Monday and Friday's key jobs figures, as fears grow that the world's largest economy is slipping deeper into recession.

Markets will also be looking at how Congress responds to a business plan due to be presented this week by the Big Three automakers - General Motors, Ford and Chrysler - as part of their efforts to secure government aid.

Shares in carmakers fell on news that Japanese auto sales dropped to the lowest in nearly four decades in November, diving 27.3 per cent to 215,783 units, according to the Japan Automobile Dealers Association. -- AFP, BERNAMA, REUTERS, AP