Asian stock markets mixed after last week's rout

HONG KONG - Most Asian stock markets recovered Monday after last week's historic sell-off as governments around the world intensified efforts to boost the ailing financial system.
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Hong Kong's Hang Seng Index, which tumbled more than 7 percent Friday, opened over 2 percent but shed its gains to trade about 360.50 points higher, or 2.44 percent, at 15,157.37.

In Australia, the S&P/ASX200 index was up 4 percent in response to a government plan to guarantee bank and other lender deposits for three years. The benchmark plunged over 8 percent on Friday, its biggest single-day fall ever.

South Korea's benchmark gained more than 2 percent and Singapore's key stock measure was up about 1 percent. But China's key Shanghai index traded 2 percent lower, while Taiwan's benchmark lost more than 3 percent.

Japan's market, where the Nikkei 225 tanked nearly 10 percent Friday to close out its worst week in history, was closed for a public holiday.

The region's markets showed signs of life after European nations agreed Sunday to temporarily guarantee bank refinancing and provide fresh capital to distressed banks as part of a host of emergency measures to help the credit markets. In the U.S., Treasury Secretary Henry Paulson called Sunday for coordinated, international steps to deal with the global financial crisis.

Yet investors were still highly cautious, worried about eroding economic conditions, shrinking company earnings and further market turmoil, analysts said. There could be more selling ahead if individual investors, spooked by the steep declines in stock prices, continue to yank money from mutual funds and asset managers.

"You have a situation of global forces selling, which is outweighing optimism about political endeavors at the moment," said Benjamin Collett, head of hedge fund sales trading Daiwa Securities SMBC Co. in Hong Kong. "You have to assume that we're going to go lower, that the risk is to the downside."

Wall Street futures indicated a sharp rebound is in store for the major indexes ahead of the opening bell on Monday. Dow Jones industrials futures rose 235 points, or 2.8 percent, to 8,605. Nasdaq 100 futures rose 38.5, or 3 percent, to 1,321.00; and Standard & Poor's 500 futures added 31.8, or 3.5 percent, to 922.80.

In a volatile session Friday in New York, the Dow Jones industrial average fell 128, or 1.49 percent, to 8,451.49, gyrating within a 1,000 point range. The average had its worst week on record in both point and percentage terms.

Elsewhere in Asia, Indonesia's key index plummeted more than 6 percent Monday after the lifting of a trading suspension, imposed last Wednesday amid a freefall in share prices. Investors seemed little encouraged by government measures to free up liquidity, including easing regulations for share buybacks and corporate financial reserve limits.

Oil prices rebounded from Friday's sharp loss, with light, sweet crude for November delivery up $2.80 at $80.50.

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