Asian markets decline after Dow plunges By MARI YAMAGUCHI,
Associated Press Writer
51 minutes ago
Asian markets tumbled Friday in the wake of one of Wall Street's
biggest losses of the year, with Japanese stocks also taking a hit
on the yen's recent strength and uncertainty about weekend
elections.
Markets in Hong Kong, Australia, Taiwan, Singapore, Malaysia and
the Philippines also fell sharply as international investors pulled
out of riskier assets, including Asian emerging markets.
Investors were rattled after U.S. markets plunged Thursday amid
worries over the U.S mortgage and corporate lending markets. But
analysts said the sell-offs had more to do with a sudden change in
sentiment than any direct link between Asian markets and U.S.
subprime mortgage woes.
"If big foreign funds have selling orders, they tend to go by
region. If they sell Asia funds, they do it to reevaluate
portfolios or cover losses in the U.S.," said Rommel Macapagal,
chairman of Westlink Global Equities
"But for local investors, it's a sentiment. When big drops occur,
they tend to get jittery because of expectation of foreign funds
selling. They tend to get out," he said.
In Tokyo, the Nikkei 225 index sank 418.28 points, or 2.36 percent,
to close at 17,283.81. At one point, the index fell nearly 3
percent before recouping some losses. Losers included Honda Motor
Co., Toshiba Corp. and Nikon Corp.
Philippine stocks suffered their biggest percentage drop in 10
years Friday, sinking 3.9 percent. Taiwan's benchmark index fell
even more, dropping 4.2 percent. In afternoon trading, Hong Kong's
Hang Seng index was down 1.9 percent, while Singapore's Straits
Times index slid 3.2 percent.
In New York Thursday, the Dow Jones industrial average plunged
311.50 points or 2.26 percent, to 13,473.57, its biggest point drop
since Feb. 27, when a fall in the Shanghai stock market unnerved
world exchanges.
In Tokyo, Japan's Chief Cabinet Secretary Yasuhisa Shiozaki,
brushed off concerns about the influence by the U.S. stock declines
on the economy in the region.
"The Japanese economy is expanding stably and I have not heard that
there have been any major fluctuations in other key countries,"
Shiozaki said.
Investors in Japan were also unnerved by the yen's recent
appreciation against the dollar, which erodes overseas income at
the country's key exporters. The dollar fell to 118.70 yen in
afternoon trading in Tokyo, down from 119.46 yen late Thursday in
New York.
"A stronger Japanese yen has a greater impact on today's Nikkei
than overnight losses on U.S. stocks," said Hiroyuki Fukunaga,
chief strategist at Rakuten Securities.
There was also anxiety in Japan about Sunday's upper house
elections. Recent newspaper polls have predicted that the long
ruling Liberal Democratic Party could win fewer than a third of the
seats contested in Sunday's upper house elections.
A defeat would not immediately threaten its hold on power, but
Prime Minister Shinzo Abe could face pressure to resign from other
leaders within his party and from the public.
___
Associated Press Writer Hrvoje Hrjanski in Manila contributed to
this report.
