Asian stock markets slide amid US recovery doubts
Tuesday, 3 November 2009
TOKYO, Nov 2 (AP): Asian stock markets fell Monday after grim news about American consumers sowed more doubts about the strength of the US economic recovery and sent Wall Street tumbling last week. European shares were mixed.
Exacerbating investor worries was US lender CIT Group's bankruptcy filing Sunday, which dragged financials sharply lower across the region.
Japan's key Nikkei 225 stock average led Asian declines, down 231.79, or 2.3 per cent, at 9,802.95. Hong Kong's Hang Seng index lost 132.68, or 0.6 per cent, to 21,620.19 while Australia's S&P/ASX 200 was down 2.2 per cent. South Korea's market dropped 1.4 per cent.
Benchmarks in New Zealand, Taiwan and Singapore also fell, though the region recovered some early losses on strength in mainland China. The Shanghai Composite index was the only major market in positive territory, up 2.7 per cent on stronger manufacturing figures and higher bank earnings.
As trading got underway in Europe, Britain's FTSE 100 was up 0.1 per cent while Germany's DAX was down 0.2 per cent and France's CAC-40 was off 0.1 per cent.
On Friday, US markets sold off after government figures for September showed personal spending fell 0.5 per cent and personal income remained flat compared to the previous month. A drop in a key measure of consumer sentiment added to the day's troubling signs that US consumers, whose voracious spending helped drive global growth before the crisis, were unlikely to resume their spendthrift ways anytime soon.
More bad news followed Sunday with CIT filing for Chapter 11 protection after struggling for months to avert bankruptcy. It was one of the biggest filings in US corporate history, following Lehman Brothers, Washington Mutual, WorldCom and General Motors.
The latest US developments only add to the market's confusion over where exactly the world's biggest economy is headed, analysts said.
"People have been skeptical all along" of the US economy, said Francis Lun, general manager for Fullbright Securities in Hong Kong. "That's why you have these wild gyrations all over, because you have good figures one day and then bad ones the next day."
Financials retreated in the wake of CIT's bankruptcy.
Mitsubishi UFJ Financial Group Inc., Japan's biggest bank, lost 1.2 per cent, while brokerage Nomura Holdings Inc. fell 2.1 per cent. In Sydney, National Australia Bank Ltd slid 3.2 per cent, while HSBC Holdings was down 1 per cent in Hong Kong.
Concerns about the US outlook and the strong yen hit Japanese exporters, including Sony Corp. The issue plunged 5.6 per cent, despite the company reporting a smaller-than-expected 26.3 billion yen ($289 million) quarterly loss Friday.
The Dow fell 249.85, or 2.5 per cent, to 9,712.73 Friday. It ended October with a meager gain of 0.005 per cent.
The broader Standard & Poor's 500 index fell 29.92, or 2.8 per cent, to 1,036.19, and the Nasdaq composite index dropped 52.44, or 2.5 per cent, to 2,045.11.
US markets were headed for a higher open. Dow futures rose 26 points, or 0.3 per cent, to 9,690, while S&P futures climbed 3.3, or 0.3 per cent, to 1,036.
Oil prices were higher after a big fall, with benchmark crude for December delivery up 22 cents to $77.22 a barrel. The contract dropped $2.87 to settle at $77.00 Friday.
The dollar rose to 90.10 yen from 89.67 yen late Friday. The euro edged up to $1.4759 from $1.4714.
Exacerbating investor worries was US lender CIT Group's bankruptcy filing Sunday, which dragged financials sharply lower across the region.
Japan's key Nikkei 225 stock average led Asian declines, down 231.79, or 2.3 per cent, at 9,802.95. Hong Kong's Hang Seng index lost 132.68, or 0.6 per cent, to 21,620.19 while Australia's S&P/ASX 200 was down 2.2 per cent. South Korea's market dropped 1.4 per cent.
Benchmarks in New Zealand, Taiwan and Singapore also fell, though the region recovered some early losses on strength in mainland China. The Shanghai Composite index was the only major market in positive territory, up 2.7 per cent on stronger manufacturing figures and higher bank earnings.
As trading got underway in Europe, Britain's FTSE 100 was up 0.1 per cent while Germany's DAX was down 0.2 per cent and France's CAC-40 was off 0.1 per cent.
On Friday, US markets sold off after government figures for September showed personal spending fell 0.5 per cent and personal income remained flat compared to the previous month. A drop in a key measure of consumer sentiment added to the day's troubling signs that US consumers, whose voracious spending helped drive global growth before the crisis, were unlikely to resume their spendthrift ways anytime soon.
More bad news followed Sunday with CIT filing for Chapter 11 protection after struggling for months to avert bankruptcy. It was one of the biggest filings in US corporate history, following Lehman Brothers, Washington Mutual, WorldCom and General Motors.
The latest US developments only add to the market's confusion over where exactly the world's biggest economy is headed, analysts said.
"People have been skeptical all along" of the US economy, said Francis Lun, general manager for Fullbright Securities in Hong Kong. "That's why you have these wild gyrations all over, because you have good figures one day and then bad ones the next day."
Financials retreated in the wake of CIT's bankruptcy.
Mitsubishi UFJ Financial Group Inc., Japan's biggest bank, lost 1.2 per cent, while brokerage Nomura Holdings Inc. fell 2.1 per cent. In Sydney, National Australia Bank Ltd slid 3.2 per cent, while HSBC Holdings was down 1 per cent in Hong Kong.
Concerns about the US outlook and the strong yen hit Japanese exporters, including Sony Corp. The issue plunged 5.6 per cent, despite the company reporting a smaller-than-expected 26.3 billion yen ($289 million) quarterly loss Friday.
The Dow fell 249.85, or 2.5 per cent, to 9,712.73 Friday. It ended October with a meager gain of 0.005 per cent.
The broader Standard & Poor's 500 index fell 29.92, or 2.8 per cent, to 1,036.19, and the Nasdaq composite index dropped 52.44, or 2.5 per cent, to 2,045.11.
US markets were headed for a higher open. Dow futures rose 26 points, or 0.3 per cent, to 9,690, while S&P futures climbed 3.3, or 0.3 per cent, to 1,036.
Oil prices were higher after a big fall, with benchmark crude for December delivery up 22 cents to $77.22 a barrel. The contract dropped $2.87 to settle at $77.00 Friday.
The dollar rose to 90.10 yen from 89.67 yen late Friday. The euro edged up to $1.4759 from $1.4714.