``The market is quiet. There is no particular reason, just lack of incentives and turnover is very low,'' said Ricky Tam, research director at Delta Asia Securities. Tam said overseas investors stayed on the sidelines in the absence of clear signs that the Japanese government will launch permanent tax cuts.

``I think the market is trying to follow the direction of the yen,'' which has been the main concern with local interbank rate rising every time the Japanese currency weakened, he said.

The key Hang Seng index lost 195.40 points to close at 8,433.78, following a 2.2 per cent gain the previous day. Turnover amounted to 3.239 billion Hong Kong dollars (418 million US), down from the previous day's 3.45 billion Hong Kong dollars.

Despite the Hong Kong Monetary Authority's (HKMA) disclosure that it was planning to repatriate some three billion dollars in overseasdeposits to ease local liquidity, the market opened weakly with the key barometer losing 85.81 points by the end of the morning session.

Sean Li, associate director at Amsteel Securities, said overseas investors remained cautious about the regional economy.

``They are looking at us as a whole in the region and until the Japanese government can convince them (about plans to boost its economy), turnover in the Hong Kong market will continue to dwindle,'' Li said.

He added the HKMA's announcement failed to stir buying interest.

The index was seeing strong support at current levels and at worst will test 8,200 points, he said, adding that the market may see highs of 8,900 to 9,100 points.

In Singapore, share prices ended 0.4 per cent lower Thursday amid weaker regional currencies and lack of interest, dealers said. ``The market is just drifting off, there is a total lack of interest amid the economic slowdown and risk to economies,'' a dealer with a local brokerage said.

A dealer with a Europeanbrokerage said a decline in most Asian currencies arising from a weaker yen also dampened market sentiment.

The benchmark Straits Times Industrials index of the Stock Exchange of Singapore fell 4.13 points to end at 1,103.65 while the broader All-Singapore index fell 0.07 points to 309.06 points.