Japanese share prices closed 1.0 per cent lower on profit-taking, while Hong Kong shares were up slightly on gains overnight on Wall Street but capped by China announcing that its first half gross domestic product (GDP) fell to seven per cent against the yearly target of eight per cent. Malaysian shares climbed 3.6 per cent, while the market in neighbouring Singapore was up nearly two per cent on technical rebounds, dealers said. Bangkok shares soared 4.7 per cent on expectations of a cut in interest rates.

Jakarta shares rose 2.6 per cent on a wave of optimism over the International Monetary Fund's decision to extend a further US$ 6 billion in a financial bailout package to Indonesia. Seoul financial markets were closed for a public holiday. Japanese share prices were easier from theoutset on selling to clear off positions ahead of a long weekend while there was chance for profit to be made from recent gains, brokers said.

The Nikkei-225 on the Tokyo Stock Exchange lost 161.14 points to 16,570.78. The Topix of all issues on the first section fell 2.78 points to 1,277.95. "The declines on the day can be regarded as within the range of an expected consolidation after four straight days of gains," a Meiko Securities Co Ltd broker said. "As share prices will reflect movement of the Liberal Democratic Party's presidential election next week, for the most part, investors are still cautious," the broker said.

Brokers said the positive impact from speculation that veteran politician Seiroku Kajiyama would run for the prime minister's position had now run its course. Investors are waiting for further details of what the future economic policy will be before committing additional funds to the market, brokers said.