Asian shares extended gains yesterday, with Japan and South Korea hitting multi-week highs.

Gold extended falls on news the US Congress will support sales of bullion by the International Monetary Fund (IMF), while oil held steady above $99 a barrel.

The MSCI measure of Asian stocks excluding Japan rose 0.9 percent after having dropped almost 10 percent this year as of Monday’s close.

Taiwan shares rose 0.8 percent on continued hopes for improved ties with China, while Chinese stocks gained 1.2 percent, recovering from a slump a day earlier, after the securities regulator warned companies against making big issues of new shares.

Meantime local traders started to blame political noise as the reason behind the market’s flat finish yesterday.

The Philippine Stock Exchange index (PSEi) lost its early lead to close 0.22 percent lower at 3,079.54, a 0.70 point decline over its Friday closing.

PCCI Securities, Inc. president Francisco Liboro said "we opened high, but after profit taking and foreign selling on some index stocks. But liquidity is drying up and some investors are staying on the sideline".

"I think all this political noise is starting to affect investments in the market," he added.

Irvin I. Ackerman, I. Ackerman & Co., Inc. president, shared the view of Liboro who noted that the current political instability’s effect on the market has become worse.

Trading turnover reached P2.87 billion, trading about 1.86 billion shares,

Most actively traded Philippine Long Distance Telephone Co. was up P30 to P2,875.

Megaworld was down P0.18 to P2.10. Ayala Corp. was down 7.50 to P432.50. Unit Ayala Land, Inc. was steady at P11.50. SM Investments, Inc. was up P7.50 to P290. SM Prime Holdings, Inc. was up P0.10 to P9.