Asian markets down on concern about Japan, US

BEIJING (AP) — Asian stocks fell Wednesday amid concern about a lack of new Japanese moves to calm bond markets and uncertainty about the outlook for U.S. monetary policy.

Oil prices fell to below $95 per barrel amid concern central bankers around the world might ease off measures to boost the global economy.

Investors were disappointed after Japan's central bank failed to deliver expected measures Tuesday to ease bond market volatility. Instead, the bank only upgraded its economic outlook.

Tokyo's Nikkei 225, the regional heavyweight, shed 0.1 percent to 13,291.10, after spiking up nearly 5 percent Monday after the prime minister promised new tax cuts. Markets in China, Hong Kong and Taiwan were closed for a holiday.

Seoul's Kospi shed 0.6 percent to 1,909.07 while Sydney's ASX S&P 200 fell 0.7 percent to 4,723.20. Singapore's FTSE Straits Times index lost 0.2 percent to 3,163.35 while India's Sensex lost 0.3 percent to 19,085.49. Jakarta and New Zealand also fell.

"Riots in Istanbul, central banks raising stop signs, bond yields on the rise and equity markets skidding; brace yourselves, we are in for a very rough ride over the coming weeks," Evan Lucas, market strategist for IG in Melbourne, said in an email commentary.

On Wednesday, Indonesia's central bank raised interest it pays on overnight deposits by banks by 0.25 percentage points to 4.25 percent in response to capital outflows. Analysts had expected such a move but not so soon.

Uncertainty about China's recovery has weighed on markets following weekend data showing exports, retail sales and other indicators weaker than expected.

Trading this week has been lackluster following a volatile period that saw many major markets come off multiyear or even record highs.

Major indices in the United States, Britain, France and Germany all fell Monday.

Investors also closely watching the United States and whether the Federal Reserve eases its monetary stimulus. The Fed has been buying bonds to push down market interest rates.

Speculation that the Fed might wind down its stimulus had depressed stock prices but concern eased after last week's U.S. jobs data suggested a recovery might not be strong enough yet.

The euro has gained on easing expectations of tighter U.S. monetary policy despite uncertainty about the outlook for the 17 countries that use the common European currency. But on Wednesday, the euro slipped to $1.3300 from $1.3311 late Tuesday in New York. The dollar rose to 96.86 yen from 96.22 yen.

Benchmark crude for July delivery declined 84 cents to $94.54 per barrel in electronic trading on the New York Mercantile Exchange. On Wednesday, the contract fell 39 cents to settle at $95.38.

Via Yahoo News!

India says Sino-Pakistan ties a 'serious concern' (AFP)

NEW DELHI (AFP) – India views with "serious concern" growing defence ties between China and Pakistan and says it will have to bolster its own military capabilities to meet the challenge.

"It is a matter of serious concern for us. The main thing is we have to increase our capability -- that is the only answer," Defence Minister A.K. Antony told reporters in New Delhi late on Friday.

The comments followed reports China plans to accelerate supply of 50 new JF-17 Thunder multi-role combat jets to Pakistan under a co-production pact.

Antony added safe havens for militants in Pakistan is another "main concern" for New Delhi and told Islamabad to "disband and destroy" all guerrilla outfits if it "sincerely" wants to improve relations with India.

The killing by US commandos of Osama bin Laden who was hiding out near the Pakistani capital Islamabad has "internationally stamped the nation?s position as the core of terrorist activities in the South Asian region," he said.

India has long accused Pakistan of providing shelter and support to militant groups planning attacks on Indian soil and has pushed the global community -- the United States in particular -- to censure Pakistan.

Nuclear-armed India and Pakistan have fought three wars since attaining independence in 1947, two of them over the disputed territory of Kashmir.

Antony declined to comment on remarks by senior Indian military leaders that India has the capability to launch a strike like the one the US carried out in Pakistan to kill bin Laden.

Prime Minister Manmohan Singh has said India would not undertake such a strike.

But a leaked diplomatic cable published earlier in the week quoted India's home minister as saying in 2009 that India would have to respond to another attack on its soil by Pakistan-based militants.

Discussing the prospect of another raid after the Mumbai 2008 assault which killed 166 people, home minister P. Chidambaram said, "The people of India will expect us to respond," according to the WikiLeaks whistleblowing website.

Antony added that India may sign a contract to buy 126 fighter jets for its air force by the end of March 2012.

"This fiscal (year) ends on March 31, 2012. The deal can happen before that," Antony said.

Last month, India shortlisted France's Dassault Aviation SA and European consortium Eurofighter GmbH for the contract. The deal, estimated at $10 billion, is considered the biggest of its kind globally in the past 15 years.

India has allocated 1.64 trillion rupees ($3.6 trillion) for the defence sector in the fiscal year through March 2012, up from 1.47 trillion last year. The budget is nearly double the 890 billion rupees in the 2006-07 year.

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