UPDATE: Asian Shrs End Lower; Hana Fincl Takes Hit, Dn 14.4%

Asian markets ended mostly lower in volatile trading Monday, with South Korean stocks suffering a steep decline as trading resumed after a holiday and as Hana Financial Group plunged on a report it may raise capital.

Japanese stocks fell as sentiment was hurt by Friday's weaker-than-expected U.S. jobs report, offsetting a surge in Fast Retailing shares after the company reported strong September sales.

South Korea's Kospi dropped 2.3% to 1606.90 and Japan's Nikkei 225 Average declined 0.6% to 9674.49, with both benchmarks falling for a third straight session. In Hong Kong, the Hang Seng Index rose 0.3% to 20429.07 after Friday's sharp loss.

"The theme of the market is that the stimulus money has run out. Fundamental analysts are looking to the U.S. round of earnings to confirm that spending has slowed down, and the funds are now exhausted," said Ben Collett, head of cash equities at TFS Derivatives. "I don't hear a lot of people talking about a collapse although I hear a lot of them talking about markets coming off. That itself is enough to encourage choppy trading like this."

Taiwan's Taiex rose 0.4%, New Zealand's NZX 50 slipped 0.3% and the Philippines' PSE Composite ended flat. India's Sensex fell 1.6% and Singapore's Straits Times Index lost 0.8%.

Australia's S&P/ASX 200 slipped 0.6% to take losses into a fourth successive session, a day before the central bank decides on interest rates. Although most economists expect the Reserve Bank of Australia to stay pat on its key policy rate Tuesday, some were factoring in a rate increase later this year.

"Investors in global equity markets will likely spend some time adjusting expectations for the economic recovery," said Oh Tae-dong at Taurus Investment & Securities in Seoul. "But as long as policy makers refrain from a premature exit from their stimulus programs, the uptrend for global stock markets will likely continue."

The Industrial Average futures contract was up 32 points in screen trade recently.

Investor sentiment in Asia was weakened by data Friday showing U.S. employers cut a larger-than-expected 263,000 jobs in September, while unemployment rate rose to 9.8%, matching economists' forecasts, from 9.7% in August.

In Japan, Fast Retailing shares climbed 14.9% after the company said late Friday that September same-store sales at its Uniqlo casual clothing chain soared 31.6% from the year-earlier period.

Morgan Stanley lifted the stock's rating to "overweight" from "equal-weight," saying: "We take this as proof that last year's strength was not a one-off, but rather that the firm's constant efforts to brush up its merchandise and highly sensitive marketing approach are enabling it to appeal continually to consumers with new value."

Consumer-finance stocks were also supporting the market after skidding recently. Aiful rose 8.2% and Takefuji jumped 12.8%.

But exporters extended their decline on the yen's strength, as the currency continued to hover around the 90 yen to the dollar level. Shares of Sony fell 2% and Honda Motor lost 2.8%, while Toshiba shed 1.8%.

Shares in Seoul were sharply lower as investors priced in the sharp weakness in global markets Friday, when the South Korean market was shut for a holiday. Financial and technology stocks were lower, with Shinhan Financial down 3.8% and Samsung Electronics tumbling 5.7%. Hyundai Motor rose 0.5% after reporting a 27% year-to-year rise in its American sales for September.

Hana Financial Group tumbled 14.4% on a Yonhap report that the firm was considering a rights offering to pursue mergers and acquisitions. A spokesman for Hana Financial said that a decision on the rights offering had not been made.

In Mumbai, shares of diversified Grasim Industries sank 7.1% after the company's board Saturday approved a spin off of its cement business to a subsidiary in the first step toward a proposed integration with group cement major UltraTech Cement.

In foreign exchange markets, the U.S. dollar was buying 89.79 yen from 89.75 yen in late New York trade on Friday. The euro was at $1.4624 from $1.4572, and at 131.36 yen from 130.79 yen.

The Australian dollar was firmer against the greenback, boosted by data showing that the total number of job advertisements in Australian newspapers and on the internet rose 4.4% in sequentially-adjusted terms in September compared with August. The Aussie dollar was recently buying $0.8732 from around $0.8664 before the data.

Japanese government bonds declined on profit-taking as U.S. Treasurys weakened Friday despite the disappointing jobs data. The lead December JGB futures contract was down 0.11 at 139.50. The 10-year cash JGB yield was up 1 basis point at 1.26%.

Spot gold was up $1.40 at $1,003.70 per troy ounce recently. Gold prices were likely to breach $1,100 per ounce in 2010, according to Deutsche Bank. "We expect U.S. dollar weakness, higher inflation, central bank buying and a more rigorous enforcement in position limits in energy and agricultural markets will sustain the appeal of precious metals."