* Samsung posts first quarterly loss, leads tech sector
lower
* Policies temper gains in long-maturity government bonds
* Cash is still king among fund managers-Merrill Lynch
survey
* U.S. dollar boosted by safe-haven appeal, Geithner
comments
(Repeats to more subscribers, updates prices, adds European
outlook)
By Kevin Plumberg
HONG KONG, Jan 23 (Reuters) - Asian stocks fell 2 percent
to a 1-1/2-month low on Friday, weighed by poor corporate
results in the technology sector, while the U.S. dollar drifted
higher as investors sought refuge from the deteriorating global
economy.
Major European stock markets were expected to open mixed,
according to UK financial bookmakers, after slipping for four
straight days. Britain's FTSE <> was seen starting as much
as 0.4 percent lower, while Germany's DAX <> was expected
to rise 0.6 percent.
Government bonds edged higher, with investors parking their
money in havens over long holiday weekends throughout Asia. The
five-year Japanese government bond yield plumbed three-year
lows.
Oil prices slipped to $43 a barrel as a buildup in U.S.
inventories reflected a lack of energy demand from struggling
consumers and businesses.
Samsung Electronics <005930.KS> reported up its first ever
quarterly loss on Friday, following stark warnings from tech
giants like Microsoft <MSFT.O>, Nokia <NOK1V.HE> and Sony, as
consumers pull back severely on their spending on gadgets in
the face of recessions in Britain, much of Europe, Japan and
the United States. []
The MSCI index of Asia-Pacific stocks outside Japan
<.MIAPJ0000PUS> fell 2.2 percent to the lowest since Dec 5.
Traders were reluctant to take any risks ahead of long Lunar
New Year holidays throughout Asia next week.
Japan's Nikkei share average <> finished at a
two-month low, down 3.8 percent. Shares of Sony Corp <6758.T>
dropped 7 percent after saying on Thursday it would post a
record $2.9 billion loss.
"With Sony the way it is, it's easy to imagine how other
electronics makers are faring. On top of that, many companies
haven't yet priced in the recent strength in the yen into their
earnings forecasts," said Fumiyuki Nakanishi, manager at SMBC
Friend Securities in Tokyo.
Hong Kong's Hang Seng index <> was one of the relative
outperformers in the region, slipping only 0.2 percent. Shares
in index heavyweight HSBC <0005.HK> rose 2.6 percent but were
down for the third consecutive week.
In Australia, the benchmark S&P/ASX 200 <> dropped 4
percent, dragged down by banks and mining stocks. Rapidly
slowing growth in China, a big consumer of raw materials, has
been devastating for commodity producers.
By and large, fund managers globally remain defensively
positioned, with heavy allocations for cash, according to a
January survey of money managers conducted by Merrill Lynch.
The poll showed a slight trimming in underweight positions
in equities, to 28 percent from 34 percent, and in overweight
bond positions to 11 percent from 22 percent.
However, cash is still king. Cash positions in Europe
climbed to the highest since 2001, with 42 percent of
respondents there saying they are overweight cash compared with
29 percent in December.
Investors are talking a more positive story, especially
with regards to the United States, but the fear factor remains,
said Gary Baker, Banc of America Securities-Merrill Lynch Head
of EMEA Equity Strategy.
"They have firepower to act, but are unconvinced by the
modest recent equity rally, suggesting it is a bear market
rally in both sentiment and markets," he said in a report.
Fear also was driving demand for U.S. dollars. The euro
fell 0.6 percent to $1.2930 <EUR=> and sterling fell 0.9
percent to $1.3746 <GBP=>
The dollar was at 89.14 yen <JPY=>, down 0.3 percent on the
day, closing in on Wednesday's 13-year low of 87.10 yen. The
yen has acted like a refuge throughout the financial crisis,
especially as Japanese investors bring overseas investments
back home.
U.S. Treasury Secretary nominee Timothy Geithner said a
strong U.S. currency was in the national interest, repeating a
mantra held since the Clinton administration in the 1990s and
giving investors a sense of stability. []
In the bond market, the five-year Japanese government bond
yield slipped 1.5 basis point to 0.66 percent <JP5YTN=JBTC>,
its lowest since September 2005 after the central bank said the
economy would likely shrink in the next two fiscal years and
anticipated a period of falling prices.
Longer-dated U.S. Treasuries have been sliding on growing
fears that a rising tide of government debt issuance could
swamp the market. However, some investors stepped in to buy
them on Friday. The yield on the benchmark 10-year note
<US10YT=RR>, which moves in the opposite direction of the
price, ticked down to 2.57 percent from 2.60 percent overnight.
U.S. crude futures for March delivery <CLc1> were down 70
cents to $42.97 a barrel but well off a four-year low of $32.40
touched last month.
(Additional reporting by Aiko Hayashi in TOKYO; Editing by Kim
Coghill)
