Crude oil pulled back below $48 a barrel on Thursday on expectations the United States may release oil from its strategic reserve, but Asian shares fell on fears that high energy costs could cut into company profits. Technology companies, such as Taiwan Semiconductor Manufacturing Co. <2330.TW> and Korea's Samsung Electronics Co. Ltd. <005930.KS> that are sensitive to consumer spending, led most Asian bourses lower. "Foreign investors are selling after the rise in oil prices and the dip in U.S. markets, and all of this is constraining the market," said Seo Jeong-kwan, an analyst at LG Investment & Securities Co. in South Korea. Oil prices had jumped as high as $48.65 a barrel -- 75 cents below its all-time record of $49.40 on Aug. 20 -- after the U.S. government reported a big drop in oil stockpiles to the lowest level since February because of disruptions from Hurricane Ivan. That move knocked U.S. stock markets more than one percent lower, but the impact in Asia was limited because Japanese markets were closed for a national holiday. Spot oil fell 43 cents in Asian trade to $47.92 a barrel after two U.S. refineries asked the Bush administration to loan crude oil from the nation's emergency stockpile. A government source told the administration could announce as soon as Thursday whether it will approve the requests.
Oil has traded above $40 a barrel since July 14 amid persistent concerns over disruptions to global supplies. The U.S. dollar extended gains, mainly against the yen, as analysts concluded the Fed would probably raise interest rates again this year, possibly at its Nov. 10 meeting. The dollar bought 110.86 yen at 0230 GMT, up from 110.55 in late New York trade. The euro stood at $1.2262 versus $1.2264 in late New York trade.
ASIAN STOCKS
Stock markets were down across Asia. The MSCI index of Asian share markets outside Japan <.MSCIAPJ> fell 0.5 percent, and its technology component <.MSCIAPJIT> dropped 1.1 percent. Taiwan's tech-heavy benchmark index <.TWII> sagged 0.7 percent, retreating from a 15-week high set on Wednesday. Shares in the world's top contract chipmaker, Taiwan Semiconductor Manufacturing Co. <2330.TW>, fell two percent. Benchmark indexes in South Korea <.KS11> and Hong Kong <.HSI> fell 0.6 percent. Singapore's Straits Times Index <.STI> fell 0.5 percent, pulled lower by blue chips such as United Overseas Bank , down 1.5 percent, and Singapore Telecommunications Ltd. , which fell 0.8 percent. Australia's benchmark S&P/ASX 200 index <.AXJO> edged 0.1 percent lower. Media giant News Corp fell 2.1 percent and diversified miner BHP Billiton eased 0.3 percent, retreating from its all-time high of A$14.08 reached on Wednesday. On the positive side, oil producer Hardman Resources rose about four percent to a one-month high of A$2.16. The blue-chip Dow Jones industrial average<.DJI> fell 1.33 percent to 10,109.18, its lowest close in more than three weeks. The technology-heavy Nasdaq Composite Index <.IXIC> closed down 1.85 percent to 1,885.71. The yield on the U.S. benchmark 10-year note , which moves inversely to its price, dropped below 4.0 percent for the first time in five months. Spot gold traded at $407.00 an ounce, up marginally from $406.75 in New York.///www.s.com