HONG KONG: Rising tensions on the Korean peninsula hit Asian stocks on Monday with markets in Seoul and Tokyo leading regional losses.
South Korea's decision to press ahead with a live-fire artillery test has led to concerns the North will respond aggressively and prompted an emergency session of the UN Security Council at the request of Russia.
In morning trade Tokyo fell 0.32 percent and Seoul tumbled 1.06 percent. Hong Kong slipped 0.41 percent and Singapore was 0.38 percent off while Shanghai gave up 0.78. Sydney was flat.
The US-backed test is planned on the South's island of Yeonpyeong, which Northern forces shelled last month, killing four South Koreans, two of them civilians. The military has told civilians on five South Korea border islands to take shelter.
Some profit-taking added to selling pressure after recent gains, with trade sluggish as foreign investors took to the sidelines ahead of Christmas holidays, brokers said. "There is a tendency for downward corrections when the market momentum is sluggish with foreign investors away," Kenichi Hirano, operating officer at Tachibana Securities, told Dow Jones Newswires.
On currency markets the rising concerns sent the won falling against the safe-haven US dollar, which in morning trade fetched 1,167.40 won from 1,163.40 earlier. The euro was hit by concerns over European sovereign debt after Moody's Investors Service Friday cut its credit rating on Ireland by five notches, citing uncertainties over its economy and public finances. The single currency fell to 1.3154 dollars from 1.3185 in New York late Friday and to 110.35 yen from 110.78 yen. The dollar firmed to 84.00 yen from 83.94 yen.
Ireland's downgrade came a day after European leaders agreed to set up a permanent financial stability mechanism from 2013 to shore up the euro amid fears Portugal and Spain may need bailouts after Irish and Greek rescues. But there was no decision to increase its size beyond the bloc's temporary 750 billion euro fund or allow it to purchase government bonds, or introduce a common European bond, John Kyriakopoulos of National Australian Bank noted.
"As such, European sovereign debt concerns are likely to linger into the New Year," he wrote in a note, adding investors needed to watch European bank funding costs.
New York's main contract, light sweet crude for delivery in January, rose 35 cents to 88.37 dollars per barrel and Brent North Sea crude for February gained 34 cents to 92.01 dollars.
Gold opened at 1,384.00-1,385.00 US dollars an ounce in Hong Kong, up from Friday's close of 1,375.00-1,376.00.
South Korea's decision to press ahead with a live-fire artillery test has led to concerns the North will respond aggressively and prompted an emergency session of the UN Security Council at the request of Russia.
In morning trade Tokyo fell 0.32 percent and Seoul tumbled 1.06 percent. Hong Kong slipped 0.41 percent and Singapore was 0.38 percent off while Shanghai gave up 0.78. Sydney was flat.
The US-backed test is planned on the South's island of Yeonpyeong, which Northern forces shelled last month, killing four South Koreans, two of them civilians. The military has told civilians on five South Korea border islands to take shelter.
Some profit-taking added to selling pressure after recent gains, with trade sluggish as foreign investors took to the sidelines ahead of Christmas holidays, brokers said. "There is a tendency for downward corrections when the market momentum is sluggish with foreign investors away," Kenichi Hirano, operating officer at Tachibana Securities, told Dow Jones Newswires.
On currency markets the rising concerns sent the won falling against the safe-haven US dollar, which in morning trade fetched 1,167.40 won from 1,163.40 earlier. The euro was hit by concerns over European sovereign debt after Moody's Investors Service Friday cut its credit rating on Ireland by five notches, citing uncertainties over its economy and public finances. The single currency fell to 1.3154 dollars from 1.3185 in New York late Friday and to 110.35 yen from 110.78 yen. The dollar firmed to 84.00 yen from 83.94 yen.
Ireland's downgrade came a day after European leaders agreed to set up a permanent financial stability mechanism from 2013 to shore up the euro amid fears Portugal and Spain may need bailouts after Irish and Greek rescues. But there was no decision to increase its size beyond the bloc's temporary 750 billion euro fund or allow it to purchase government bonds, or introduce a common European bond, John Kyriakopoulos of National Australian Bank noted.
"As such, European sovereign debt concerns are likely to linger into the New Year," he wrote in a note, adding investors needed to watch European bank funding costs.
New York's main contract, light sweet crude for delivery in January, rose 35 cents to 88.37 dollars per barrel and Brent North Sea crude for February gained 34 cents to 92.01 dollars.
Gold opened at 1,384.00-1,385.00 US dollars an ounce in Hong Kong, up from Friday's close of 1,375.00-1,376.00.
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