By V. Phani Kumar, Matthew Allen and Leslie Shaffer HONG KONG (MarketWatch) -- Most major stock markets in Asia ended lower Monday, with Japanese shares dropping as the yen gained on concern authorities might not step in to prevent the currency's rise as some had expected. Hong Kong shares declined as energy stocks slipped, reacting to the drop of oil prices dropped to a six week low in New York Friday. Australia's Foster's Group and South Korea's Ssangyong Motor soared on merger-and-acquisition activity-related reports or news. The Australian dollar erased early losses while the S&P/ASX 200 stock index finished little changed at 4,429 despite political uncertainty after the country's weekend federal elections failed to give a clear majority to either of the two main parties. "The latest betting odds show punters prefer the Coalition's chances of securing the support of the three key country independents to form a minority government. If realized, this would see the mining profit tax abolished, a positive for Australian dollar," said Sue Trinh, senior currency strategist at Royal Bank of Canada. Mining stocks were mostly higher, with BHP Billiton (BHP 67.44, +0.09, +0.13%) (AU:BHP 38.11, +0.21, +0.55%) rising 0.6% and Rio Tinto (AU:RIO 72.20, +0.62, +0.87%) (RTP 51.05, -0.48, -0.93%) gaining 0.9%. The two major parties -- the center-left Labor administration of Prime Minister Julia Gillard and the Liberal-National conservative bloc led by Tony Abbott -- said Sunday a new government likely won't be formed for a number of days. Negotiations were beginning with independent lawmakers set to decide who takes power following the country's first hung parliament in 70 years. Read full story in Asia Markets. "There was a lot of money on the sidelines ahead of this election and I just think that's going to be staying on the sidelines until this is cleared up," said IG Markets strategist Ben Potter. Japan's Nikkei Stock Average ended 0.7% lower, South Korea's Kospi declined 0.4%, China's Shanghai Composite dipped 0.1% and Hong Kong's Hang Seng Index lost 0.4%. Meanwhile, Taiwan's Taiex rose 0.6% and India's Sensex advanced 0.2% in afternoon trading. Dow Jones Industrial Average (DJIA 10,214, -57.59, -0.56%) were up 24 points in screen trade. Among the day's big stock movers, Foster's Group (AU:FGL 6.26, +0.44, +7.56%) (FBRWY 5.13, +0.03, +0.59%) jumped 7.6% after reports over the weekend said the brewing major SABMiller (SBMRY 28.92, -0.08, -0.28%) is considering a seven billion pound ($10.9 billion) bid for the group's beer arm. Read full story on SABMiller's reported offer. Ssangyong Motor shares jumped 6.9% on news India's Mahindra & Mahindra (MAHMF 14.00, -0.20, -1.41%) moved one step closer to buying a controlling stake in the Korean company by signing a memorandum of understanding for the purchase. Mahindra gained 1.1% in Mumbai trading. Read full story on the Mahindra-Ssangyong pact. Shares of HSBC Holdings (HK:5 77.15, -0.20, -0.26%) (HBC 49.30, -0.53, -1.06%) ended 0.3% lower in Hong Kong after the bank said it has entered exclusive talks to buy a majority stake in South Africa's Nedbank Group. Read full story on HSBC's talks. Japanese shares declined, weighed down after Finance Minister Yoshihiko Noda said he hasn't heard that Prime Minister Naoto Kan and Bank of Japan Gov. Masaaki Shirakawa will meet this week. Several local media reported last week the possibility of such a meeting -- possibly as early as Monday -- to discuss ways to cope with a rising yen and slowing economic growth. Exporters were broadly weak in Tokyo, with Toshiba Corp. (TOSYY 29.19, -1.30, -4.26%) (JP:6502 415.00, -7.00, -1.66%) falling 1.7% and Sony Corp. (SNE 29.51, -0.41, -1.37%) (JP:6758 2,499, -39.00, -1.54%) sliding 1.5%. Sharp Corp. (JP:6753 832.00, -21.00, -2.46%) (SHCAY 9.80, -0.14, -1.41%) fell 2.5%, extending Friday's 2.7% fall, on concerns about possible weakness in liquid crystal display panel demand. In Hong Kong, shares of Cnooc (CEO 171.57, +0.61, +0.36%) (HK:883 13.18, -0.08, -0.60%) and PetroChina Co. (PTR 110.90, +0.06, +0.05%) (HK:857 8.62, -0.05, -0.58%) declined 0.6% each on recent weakness in crude-oil prices. Shares of Sinopec (SNP 81.69, +0.28, +0.34%) (HK:386 6.26, -0.10, -1.57%) , officially known as China Petroleum & Chemical Corp., fell 1.6% in Hong Kong and 0.8% in Shanghai. The company's first-half net profit rose 6.7% from the year-earlier period, beating expectations, but the company reported a sharp drop in margins on its refining business because of government controls over product prices. In Seoul, builders rose on expectations the government may soon take measures to boost the local real estate market. Hyundai Engineering & Construction added 2.1% and GS Engineering & Construction added 3%. Elsewhere, New Zealand's NZX 50 gained 0.6%, Indonesian shares rose 0.1% and Thailand's SET Index added 0.4%. In foreign-exchange markets, the yen gained ground after Kyodo reported that Kan and Shirakawa held talks by phone on Monday to exchange views on recent developments in financial markets, but they didn't discuss intervention to cap the Japanese currency's recent strength. The U.S. dollar was buying 85.35 yen, compared with 85.75 yen late in New York on Friday, while the euro was trading at 108.47 yen, down from 108.71 yen. The euro was also buying $1.2712, from $1.2706. The Australian currency, which fell as low as 88.71 U.S. cents, came off its lows and was buying 89.27 U.S. cents from 89.40 U.S. cents late Friday in New York. Lead September Japanese government bond futures were down 0.03 at 142.83 points. The 10-year cash JGB yield was up 1.5 basis points at 0.940%. Spot gold was at $1,227.80 per troy ounce, down 20 cents from late New York Friday. Nymex October crude-oil futures were up 15 cents at $73.97 on Globex after they hit a six-week low Friday in New York.

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