Singapore / Tokyo: Asian stocks tumbled, dragging the regional benchmark index to the lowest in at least five years, as declines in Japanese wages and South Korean exports fuelled concerns the global recession is deepening.
Mitsubishi UFJ Financial Group Inc., Japan’s largest bank, retreated 6.8% as bond risk rose and the nation’s wage declines accelerated in January.
Bleak outlook: Pedestrians walks past a stock prices board in Tokyo. All Asian bourses open for trading, except Vietnam, declined on Monday.
Hynix Semiconductor Inc., Asia’s second biggest maker of memory chips, slumped 5.8% in Seoul after the country’s exports dropped for a fourth month in February. BHP Billiton Ltd, the world’s largest mining company, lost 3.1% in Sydney as metal and oil prices slumped. Treasurys rose for the first time in a week.
“We don’t know yet how long this global recession will last,” said Hisakazu Amano, head of fund management at Tokyo-based T&D Asset Management Co., which oversees about $39 billion (Rs2 trillion). “With the market dominated by an atmosphere of malaise and despair, there are few people who dare to buy.”
The MSCI Asia Pacific Index dropped 3.3% to 72.68 at 7.30pm in Tokyo, the lowest level since 15 August 2003. The gauge has fallen 19% in 2009, extending last year’s record 43% tumble, as recessions in the world’s largest economies hurt earnings at companies from BHP to Toyota Motor Corp., the world’s largest auto maker.
The Nikkei 225 Stock Average declined 3.8% to 7,280.15. Hong Kong’s Hang Seng Index sank 3.9%, while South Korea’s Kospi slid 4.2%. All markets open for trading, except Vietnam, declined.
Commonwealth Bank of Australia fell 4.3% after Moody’s Investors Service lowered its ratings outlook for the nation’s three biggest banks. Macquarie Group Ltd, Australia’s No. 1 investment bank, sank 7.2%, as it said it had no outstanding capital commitments to its listed funds.
HSBC Holdings Plc., Europe’s biggest bank, was halted from trading in Hong Kong on speculation it may raise funds to bolster capital.
Futures on the Standard and Poor’s 500 Index dropped 1.9% on Monday. The gauge fell 2.4% to a 12-year low on 27 February after the commerce department said the US economy shrank in the three months to December by the most since 1982.
The worsening global recession has pummelled Asian exports, prompting companies from Toyota to Sony Corp. to fire workers and halt factory lines. Monthly wages in Japan fell 1.3% from a year earlier, after declining 0.8% in December, the labour ministry said in Tokyo on Monday.
Mitsubishi UFJ tumbled 6.8% to 423 yen in Tokyo. Mizuho Financial Group Inc., Japan’s second largest bank, lost 3.7% to 181 yen. HSBC, whose shares were suspended in Hong Kong, reported 2008 net income of $5.73 billion, compared with $19.1 billion a year earlier.
Motoko Kakizaki and Yuichi Kato in Tokyo contributed to this story.