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Wall Street decline drags Asian markets

Wall Street decline drags Asian markets
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First Published: Thu, Sep 18 2008. 07 14 AM IST
Updated: Mon, Nov 10 2008. 12 27 PM IST
Hong Kong: Asian stocks tumbled on Thursday, tracking declines on Wall Street as investors feared more companies could succumb to the global financial crisis that forced the US to bail out troubled insurer American International Group Inc.
Every regional benchmark fell deeply in the red.
Hong Kong’s Hang Seng Index led the region’s losses, tanking 1,272.86 points, or 7.22%, to 16,364.33 its lowest level in over two years.
In Japan, the Nikkei 225 stock index was down 445.67 points, or 3.79%, at 11,304.12. Australia’s S&P/ASX200 index fell more than 3.5%, South Korea’s Kospi lost 3.6% and Shanghai’s index fell 5.8%.
The losses tracked US markets, where the Dow Jones industrial average fell about 450 points, or 4.06% to 10,609.66.
Investors were unsettled by the Federal Reserve’s $85 billion loan to AIG, the huge US insurer that lost billions in the risky business of insuring against bond defaults. It was the latest financial giant to fall in a historic financial crisis on Wall Street that’s already claimed investment banks Lehman Brothers and Merrill Lynch.
As equities markets staggered, investors fled to gold, seen as a safe haven in times of trouble. Gold for December delivery rose as much as $90.40, or 11.6%, to $870.90 an ounce in after-hours trading on the New York Mercantile Exchange after jumping $70 to settle at $850.50 in the regular session.
Oil rose above $97 in Asian trade on Thursday, extending its big gains overnight. The dollar was little changed at 104.32 yen and the euro rose to $1.4345.
Financial stocks across Asian went into a tailspin.
Japan’s three megabanks fell hard: Mizuho Financial Group, Inc. sank 7.2%, Mitsubishi UFJ Financial Group, Inc. shed 4.6%, and Sumitomo Mitsui Financial Group retreated 7.4%.
Leading China lender Industrial & Commercial Bank of China Ltd, or ICBC, fell over 5 percent in Hong Kong.
Macquarie Group Ltd., Australia’s biggest investment bank and securities firm, took an 18% nosedive.
Richard herring, the director of trading at Burrell Stockbroking, said Australian investors were nervous about AIG bailout.
Major exporters including auto makers and electronics firms also wilted, hurt by a sagging dollar and slowing overseas markets.
In Japan, Nintendo Co., maker of the popular Wii game console, tumbled 4.4 percent after earlier hitting a near year-low.
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First Published: Thu, Sep 18 2008. 07 14 AM IST
More Topics: World | Asian | Wall Street | AIG | Market crisis |