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Asian shares down after Wall Street slumps

Asian shares down after Wall Street slumps
AP
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First Published: Fri, Mar 11 2011. 09 26 AM IST
Updated: Fri, Mar 11 2011. 09 26 AM IST
Tokyo: Asian shares extended losses in early trading on Friday after the Dow Jones industrial average suffered its biggest one-day drop since August and China reported unexpectedly strong inflation.
Oil prices inched higher to near $103 a barrel Friday in Asia as traders worried protests in Saudi Arabia could escalate and hamper production in the world’s largest crude exporter.
Japan’s Nikkei 225 stock average lost 0.8% to 10,347.34, and South Korea’s Kospi fell 1.5% to 1,952.73. Australia’s S&P/ASX 200 was down 1.3% at 4,640.90.
Hong Kong’s Hang Seng index was down 1% to 23,377.92, and mainland China’s Shanghai Composite Index drooped 0.4% to 2,944.59.
China’s February inflation held steady at 4.9% as the rise in food prices accelerated, adding to pressure for the communist government to control surging living costs that it worries could fuel unrest.
Inflation in food prices accelerated in February to 11% over a year ago, up from January’s 10.3% increase. That defied forecasts by many analysts, who expected food prices to ease.
In New York Thursday, weak economic news from China, the US and Spain combined with a slump in oil companies to push stocks sharply lower. The Dow fell 228.48 points, or 1.9%, to close at 11,984.61.
Investors were jarred when China reported a surprise trade deficit in February. China’s exports fell in February as businesses closed for the weeklong Lunar New Year holiday, but imports of higher-priced oil and other goods jumped, widening the country’s deficit to $7.3 billion.
Moody’s downgraded Spain’s debt, re-igniting fears about Europe’s debt crisis. In the US, the government reported that new applications for unemployment benefits rose more than expected last week.
Meanwhile, escalating discontent in the Middle-East and North Africa continued to weigh on sentiment. Protesters already have hampered Libya’s oil production, and concerns are growing that similar unrest could spread to the world’s largest oil exporter: Saudi Arabia.
The broader Standard & Poor’s 500 index fell 24.91, or 1.9%, to 1,295.11. The Nasdaq composite fell 50.70, or 1.8%, to 2,701.02.
In currencies, the dollar fell to ¥82.82 from ¥83.02 late Thursday. The euro stood at $1.3823 from $1.3794.
Benchmark crude for April delivery dropped 4 cents to $102.66 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.68 to settle at $102.70 a barrel on Thursday.
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First Published: Fri, Mar 11 2011. 09 26 AM IST
More Topics: Asia | Finance | Saudi Arabia | Wall Street | Oil |