Asian Markets Shed Early Gains as Spain Woes Override US Data and RBA Rate Cut

Asian markets lost their early gains boosted by a better-than-expected US manufacturing data to the debt worries of Spain.

Though the dollar and euro appreciation against the Yen cheered Japanese stocks in the morning, the Nikkei ended 0.12 percent lower at 8,786.05, shedding 10.46 points mainly on concerns over earnings guidance.

Major firms such as Daido Steel, shipper Nippon Yusen KK and electric insulator maker NGK Insulators cut their earnings forecasts.

Seoul closed flat, 0.18 points lower at 1,996.03.

However, the rate cut announced by the Reserve Bank of Australia (RBA) pushed Australian stocks to higher levels. RBA said it would slash the benchmark interest rates 25 basis points to 3.25 percent which is the lowest in the past two years reflecting a weaker domestic and global growth.

"The peak in resource investment is likely to occur next year, and may be at a lower level than earlier expected," said RBA Governor Glenn Stevens.

"As this peak approaches it will be important that the forecast strengthening in some other components of demand starts to occur."

Australia's S&P/ASX 200 Index rose 1.01 percent to 4,433.0, a gain of 44.4 percent. But the Aussie dollar dropped to US $1.0320 down from the previous $1.0369.

Taipei jumped 0.56 percent to 7,718.68, up 42.96 points. Other Asian markets such as Hong Kong, Shanghai and Mumbai were closed for a public holiday.