Asian shares mixed as Yemen crisis hits sentiment

[HONG KONG] Asian markets were mixed on Friday in edgy trade as investors track the crisis in Yemen, with fears that unrest in the country could turn into a wider Middle East conflict.

Wall Street provided another negative lead while the euro struggled to regain its recent strength after tumbling in New York from levels above US$1.10 earlier in the day.

Oil price also dipped a day after surging in reaction to the unrest in Yemen.

Tokyo tumbled 0.95 per cent, or 185.49 points, to finish at 19,285.63 and Seoul fell 0.14 per cent, or 2.76 points, to 2,019.80, while Hong Kong fell 0.15 per cent.

However, Sydney added 0.69 per cent, or 40.84 points, to close at 5,919.9 following a heavy fall on Thursday, while Shanghai ended up 0.24 per cent, or 9.00 points, at 3,691.10 on hopes for more Chinese stimulus.

US traders ran for the sidelines Thursday after Saudi Arabian jets targeted rebel positions as part of its support of Yemen's president, who fled his presidential complex the previous day after it was attacked by a warplane.

Iran condemned the action by a Saudi coalition of regional Sunni nations, which has exacerbated longstanding Saudi-Iranian tensions.

Saudi Arabia, the world's top crude producer, also ramped up security along its borders and across the kingdom, including at oil facilities.

In New York the Dow eased 0.23 per cent, the S&P 500 dropped 0.24 per cent and the Nasdaq lost 0.27 per cent.

The events sent oil prices racing higher Thursday as investors fretted about possible disruptions to supplies from the crude-rich region.

US benchmark West Texas Intermediate (WTI) jumped US$2.22, or 4.5 per cent, to US$51.43 - its highest level in more than three weeks - while Brent jumped US$2.71 to US$59.19.

However, on Friday the two contracts retreated a touch. WTI was down US$1.02 to US$50.41 and Brent eased 95 cents to US$58.24.

"While we've got no actual supply disruption it's pretty clear that the market is focused on the potential here, which is enormous," Michael McCarthy, a chief markets strategist at CMC Markets in Sydney, told Bloomberg News.

"We're likely to see a further increase in volatility as the price reacts to developments." The edginess has led dealers into safer investments, lifting the dollar against the euro after a recent sell-off.

In afternoon trade the euro, which was above US$1.10 in Tokyo Thursday, bought US$1.0879 on Friday, compared with US$1.0884 in US trade.

The single currency was also at 129.67 yen against 129.71 yen in New York, but well off the 130.65 yen earlier in Asia.

The dollar was at 119.20 yen, compared with 119.18 yen in New York late Thursday, with seemingly little effect from news that Japanese inflation was flat in February.

Gold fetched US$1,204.49 against US$1,205.54 late Thursday.

In other markets:

- Taipei fell 1.20 per cent, or 115.40 points, to 9,503.72.

Acer shed 3.27 per cent to NT$20.7 while Taiwan Semiconductor Manufacturing Co was 2.06 per cent lower at NT$142.5.

- Wellington added 0.36 per cent, or 21.08 points, to 5,919.94.

Telecom giant Spark was up 0.34 per cent at NZ$2.98 and Contact Energy added 1.01 per cent to NZ$5.98.

AFP