Asian stocks lower as profit-takers cash in on recent gains

Hopes for an economic recovery lifted regional indexes on Wednesday after the Bank of Japan (BoJ) said it would keep rates at near zero and would double a loan facility available to other banks in order to increase credit.

That announcement came after the U.S. Federal Reserve pledged to keep its lending rate at rock-bottom "for an extended period" in light of tame inflation and high unemployment in a bid to help a fragile recovery from recession.

However, with little else to drive buying on Thursday investors chose to sell up, fearing the market was overpriced. Tokyo's Nikkei dropped 0.95 percent, or 102.95 points, to 10.744.03 and Hong Kong lost 0.25 percent, or 53.82 points, to 21,220.67.

Shanghai ended 0.14 percent, or 4.39 points, down at 3,046.09, with concerns that Beijing will tighten credit also weighing on sentiment.

"The Nikkei has gained sharply recently, so the market is overheated," Yukio Takahashi, market analyst at Mizuho Securities, said.

Daiwa Securities capital markets general manager Kazuhiro Takahashi said: "There aren't many incentives since the BoJ's policy board meeting.

Wall Street had provided a strong lead, rising 0.45 percent after a Labor Department report showed U.S. producer prices fell in February, snapping a four-month increase and stoking share-buying sentiment after the Fed move.

However, Sydney bucked the Asian trend, gaining 0.20 percent, or 9.9 points, to 4,863.1.

In other markets:

— Singapore closed 0.18 percent, or 5.36 points, lower at 2,913.94.

— Seoul closed 0.46 percent, or 7.69 points, lower at 1,675.17.

— Jakarta fell 0.69 percent, or 19.02 points, to 2,737.24.

— Kuala Lumpur ended flat, edging 0.01 points down to 1,301.94.

— Manila closed 0.42 percent, or 12.90 points, higher at 3,100.95.

— Wellington rose 0.62 percent, or 19.73 points, to end at 3,220.69.

— Bangkok shed 0.85 percent, or 6.52 points, to close at 759.02.

— Mumbai closed 0.17 percent, or 29.18 points, higher at 17,519.26.

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