* Asian stocks slip from 13-month highs on valuation
worries
* China worries about growing queue of new share issues
* Dollar extends gains ahead of G-20, Fed
(Repeats to more subscribers)
By Umesh Desai
HONG KONG, Sept 21 (Reuters) - Asian stocks eased on
Monday, pulling further away from 13-month highs hit last week,
as investors worried prices may have raced too far ahead of
economic fundamentals, with shares in China feeling supply
pressures ahead of a string of IPOs.
The U.S. dollar extended last week's gains with traders
covering their short positions ahead of this week's Federal
Reserve policy meeting and a Group of 20 summit.
Against a basket of currencies, the dollar's <.DXY> <=USD>
rebound from a one-year low of 76.01 on Sept 17 helped pull
gold <XAU=> from near 18-month highs. The yellow metal has
gained 16 percent so far in 2009 but has still failed to top
its all-time peak of $1,030 an ounce struck last year.
Trade was sluggish and volumes are expected to be on the
lower side in Asia with Japan shut until Thursday for holidays.
Markets in Singapore, India, Indonesia, Malaysia and the
Philippines were also shut on Monday for holidays.
The MSCI index of Asia Pacific stocks traded outside Japan
<.MIAPJ0000PUS> dipped 0.26 percent, after surging 80 percent
since mid-March when global markets started to rally on hopes
that the financial crisis had bottomed out.
This has taken price-earnings multiples on a 12-month
forward basis to above 15.2 times, near this year's high of
15.5 struck in early August, according to data from global
estimates tracker Thomson Reuters I/B/E/S.
"Valuations are certainly more expensive than they have
been, but we don't think alarmingly so," said Mark Konyn, who
oversees about $11 billion as Asia-Pacific chief executive of
RCM, a unit of Allianz Global Investors.
"Investors have positioned themselves away from some of the
China themes and more to themes aimed at recovery in the U.S.,"
he said.
U.S. markets ended modestly higher on Friday on optimism
that the global economic recovery will be strong enough to
boost corporate profits and justify higher share valuations.
[]
The U.S. Federal Reserve is expected to keep the benchmark
interest rate unchanged in a range of zero to 0.25 percent at
the end of a two-day meeting on Wednesday as it waits to see if
a tentative recovery finds solid footing.
Primary debt dealers surveyed by Reuters expect the Fed
will not start raising rates until next year for fear of
derailing the recovery. Many see a one-in-five chance of a
"double-dip" recession, in which an economy sinks back into
recession after a brief rebound. []
Investors will also be eyeing a meeting of leaders from the
Group of 20 developed and emerging nations on Sept 24-25.
The leaders are expected to reiterate that economic support
measures will remain in place as long as needed, even as they
look beyond crisis fighting to issues such as bankers' bonuses,
financial regulation and global trade imbalances.
[]
CHINA EYES IPOs
Highlighting investor skittishness, shares in Shanghai
<> fell more than 3 percent by mid-morning on Monday as
investors fretted about the prospect of a sharp increase in
shares from upcoming IPOs and worried that recent gains may be
overdone.
Analysts said subscriptions for 10 companies to be listed
on China's Nasdaq-style market to fund high-growth start-ups
had come faster than expected and could lead to a mild
consolidation for the index. [].
South Korean stocks also eased 0.3 percent after a
four-session gaining streak with foreigners piling into the
country's markets ahead of South Korea's upgrade to developed
market status by FTSE effective Monday.
The Korea Composite Stock Price Index <> (KOSPI) was
marginally lower after dropping as much as 0.5 percent in early
trade.
Foreigners have been net buyers on all but two days this
month, bringing in $4.9 billion in the last 11 sessions.
"Foreign investors' buying has slowed following their
aggressive accumulation of Seoul shares prior to South Korea's
official joining of the FTSE," said Chung Seung-jae, a market
analyst at Mirae Asset Securities.
Still, valuations in Seoul look relatively attractive.
The KOSPI's price multiple based on 12-month forward
earnings estimates was about 9.7 as of Sept 18, compared with
the region's multiple of over 15 times.
"Buying... could pick up after third quarter earnings
figures if numbers come out strong," Chung added.
Australia's benchmark S&P/ASX 200 index <> dropped 0.4
percent, led lower by weak resources stocks which were in turn
depressed by softer commodity prices.
Oil prices <CLc1> eased below $72 a barrel as traders
booked profits after a 5 percent rally last week.
(Editing by Kim Coghill)
