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Asian shares mixed in thin year end trade

TOKYO, Dec 29 – Asian stock markets were mixed Monday in thin year-end trade, with some profit-taking by investors who are bracing for what will likely be a volatile 2009.

Dealers said post-Christmas, pre-New Year volumes were low and there appeared to be no firm direction as many investors were waiting on the sidelines until January.

Tokyo\’s Nikkei index was down 0.38 percent in early afternoon trade while Shanghai fell 1.11 percent. Taipei and Seoul were also down.

But Hong Kong\’s Hang Seng ended the morning up 0.2 percent as mild bargain-hunting reversed earlier losses. Singapore, Australia and New Zealand were also in positive territory.

Tokyo, the region\’s largest market, closes with a half-day session on Tuesday and reopens on January 5.

"Since we only have one more morning session tomorrow before the market closes for this year, investors would not want to take positions before the long holidays," said Daisuke Uno of Sumitomo Mitsui Banking Corp.

Shares in insurers soared on reports of a three-way merger to shield Japan\’s non-life insurance companies from the global financial crisis.

But dealers took profits in other shares after the Nikkei rose to a six-week high last week.

In Shanghai, steelmakers dragged down the market on concerns over weak corporate performances due to the global crisis.

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"Investors\’ sentiment remains weak as they are still worrying about corporate earnings in the fourth quarter," Wang Junqing, an analyst at Guosen Securities, told Dow Jones Newswires.

Uno said the Asian market which saw the most action was Seoul, where the central bank said South Korea\’s capital investment is expected to drop for the second consecutive year.

Seoul\’s key Kospi index was down 1.2 percent at midday.

"The remarks by the president likely cast a shadow also on the market trading," Uno said.

South Korean President Lee Myung-Bak said Saturday that the country\’s economy could shrink in the first half of next year for the first time since the 1997 Asian financial crisis.

Asian markets have tumbled this year as the global credit crisis saps up liquidity and drags down the world economy. The International Monetary Fund\’s top economist warned last week of a second Great Depression.

Australia closed up 1.1 percent. Among other markets, Taipei was off 0.83 perent and Bangkok dropped 0.78 percent.

Markets were closed in Malaysia and the Philippines.

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