Asian markets tumble as financial fears deepen

NF Reporter · 09-18-2008, 03:26 AM

AP - Asian stocks tumbled Thursday, tracking declines on Wall Street as investors feared more companies could succumb to the global financial crisis that forced the U.S. to bail out troubled insurer American International Group Inc.

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waltky · 09-29-2008, 03:59 AM

Fortis failure shakes Asian markets as well...

Asian markets fall on doubts about US bailout
Sep 29, `08 - Asian stock markets fell Monday amid investors skepticism that the deal reached in Washington over a $700 billion bank bailout would quickly resolve the bad debt crisis.

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Adding to concerns of further global financial contagion was news Sunday that Belgium, the Netherlands and Luxembourg pledged more than euro11 billion ($16 billion) to Dutch-Belgian bank and insurance giant Fortis NV to keep it from insolvency. "There's an increasing realization that the cleanup and the mending of all that's gone wrong is going to take an extended period to work through, and we're going to see an extended recovery period," said Jamie Spiteri, senior dealer at Shaw Stockbroking in Sydney.

Tokyo's Nikkei 225 index was down 1.3 percent at 11,743.61, and Hong Kong's Hang Seng Index shed 2.1 percent to 18,286.90. "They're worried that another fire is starting in Europe," said Castor Pang, an analyst at Sun Hung Kai Financial in Hong Kong, referring to the Fortis news. Key stock indices in Seoul, Singapore and Sydney also declined, while benchmarks in New Zealand and the Philippines were marginally higher.

After days of intense talks, the White House and Congressional leaders agreed Sunday to a $700 billion public bailout of the ailing financial industry after lawmakers insisted on sharing spending controls with the administration of President George W. Bush. The biggest U.S. bailout in history won the tentative support of both presidential candidates and goes to the House for a vote Monday. It would give the administration broad power to use taxpayers' money to purchase billions of home mortgage-related assets held by cash-starved financial firms.

More My Way News - Asian markets fall on doubts about US bailout

waltky · 10-02-2008, 01:00 AM

Maybe a moderate uptick tomorrow?...

Asian markets dip despite U.S. bailout vote
2 Oct.`08 - Japan's Nikkei Exchange was down 131 points at 11,237.26 in morning; U.S. stocks regain some lost ground Wednesday ahead of Senate vote on bailout; European markets mixed Wednesday; central banks inject $60 billion in bank system

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Asian and Pacific stock markets dropped in early trading Thursday despite the U.S. Senate's approval of a modified $700 billion bank rescue plan intended to bolster the ailing financial system. Japan's Nikkei Exchange was down 131 points at 11,237.26, and the Korea Exchange was down slightly at 2,968.59. The Australian Securities Exchange was down slightly at 4,782.8, and Hong Kong's Hang Seng was down 0.81 percent at 17,870.43. Benchmarks in Singapore and Taiwan were also in negative territory.

"Investors are still concerned about the efficiency of this rescue plan and how it can help the global economy," said Aric Au, marketing manager for institutional sales at Phillip Securities in Hong Kong. "But at this moment, nobody is sure about this. They need to have more information about the finalized plan," The Associated Press reported. U.S. stocks trimmed losses ahead of the Senate vote Wednesday, but investors remained edgy ahead of the Senate's vote. Credit markets remained pinched, with closely watched measures of bank fear still at elevated levels. The ISM manufacturing index, a key reading on the economy, fell to a seven-year low near a level that suggests a recession.

The Dow Jones industrial average lost 0.2 percent. The Standard & Poor's 500 index slid 0.5 percent, and the Nasdaq composite lost 1.1 percent. The Dow fell more than 100 points Wednesday morning but curbed those losses in the afternoon as more specifics about the modified bailout plan were released. Financial and homebuilding shares rallied, but many other stock sectors declined, including technology and oil services.

European benchmark indexes were stable Wednesday following steady gains on Asian market, fueled by renewed hopes that an economic rescue plan would soon win legislative approval in Washington. London's FTSE 100 closed up 1.17 percent at 4,960 points, Paris' CAC was up 0.56 percent at 4,055, but the Frankfurt DAX slipped 0.42 percent to close at 5,806.

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waltky · 10-03-2008, 07:54 AM

But what if they quit buying our T-bills?...

Asian Markets Plummet on Fears of Possible US Recession
03 October 2008 - Asian markets are down in Friday's early morning trading as investors react to Thursday's grim news about the state of the slumping U.S. economy.

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Japan's benchmark Nikkei index dropped more than 1.5 percent, while markets in Singapore, Hong Kong and Sydney are also down substantially. Investors are apparently pessimistic about what effect the plan aimed at rescuing the U.S. financial markets will have on the global economy. The U.S. House of Representatives is expected to vote Friday on a measure to spend $700 billion to purchase bad bank assets.

Friday's selloff comes after the U.S. indexes fell sharply Thursday after the release of some weak economic data. The Dow Jones Industrial Average fell 3 percent, the S&P 500 dropped 4 percent, and the NASDAQ lost 4.5 percent.

The U.S. Labor Department announced Thursday the number of first-time jobless claims rose last week by 1,000 to 497,000. The weekly report also says almost 3.6 million Americans are continuing to collect government compensation - the most since September 2003.

VOA News - Asian Markets Plummet on Fears of Possible US Recession

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Stock Prices Tumble Again as Worries Grow About Possible Deep US Recession
03 October 2008 - Major credit markets worldwide remain frozen while U.S. Congress debates the Bush administration's $700-billion financial rescue package.

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This time the Dow Industrials lost 348 points or more than three percent to 10,482, its lowest close in three years. Major markets are now down about 25 percent this year. European markets Thursday were also off sharply. As gloom sets in about the weak condition of the world economy, oil prices fell again, losing nearly five percent to under $94 a barrel. John Lonski, chief economist at Moody's Capital Markets in New York, expects the central bank to soon cut interest rates.

"All along, ever since early 2007, the much greater threat has been unprecedented home price deflation as opposed to a flaring up of energy prices," said John Lonski. "So I would expect that fairly soon the Fed will shift into a mode of aggressive rate cutting. We could very well find that within one month the fed funds [overnight rate] is down to one percent." With the Senate having already approved the $700-billion financial rescue, markets are anticipating that the House of Representatives will reverse course and approve the measure, probably on Friday. Economist Lonski says the measure is not likely to have much immediate impact on credit markets.

"I think all it is going to do for the economy is prevent this current recession from becoming more severe," he said. "It is not going to be enough to prevent real gross domestic product from contracting over the next several quarters." Lonski spoke on Marketwatch.com. Financial markets anticipate that the US jobless rate will rise when the Labor Department reports Friday on the employment situation for September. A rise of 100,000 jobless is anticipated. The US jobless rate is 6.1 percent.

VOA News - Stock Prices Tumble Again as Worries Grow About Possible Deep US Recession

waltky · 10-06-2008, 02:25 AM

Asia needs to get its house in order too...

Asian Markets Open Sharply Lower
06 October 2008 - Investors still not convinced by $700 billion U.S. financial rescue plan

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Asian markets are sharply lower in morning trading Monday. Key markets in Tokyo, Hong Kong and Taipei are all down about 3.5 percent. Japan's Nikkei index has fallen to a four-year low. Investors are not convinced that a $700 billion financial rescue plan approved Friday in the United States will do much to avoid a global economic crisis. The plan allows the U.S. government to buy failing investments from troubled financial companies in an effort to restore lender and investor confidence, and to restart economic growth.

Europe Helps Banks

European leaders are pledging to bail out troubled banks and protect depositors, as they called for a more coordinated response to the global financial crisis. In Germany, government and business leaders have agreed on a rescue package for the troubled commercial property lender, Hypo Real Estate AG. The $68 billion plan replaces an earlier rescue effort that fell through on Saturday. France's biggest bank, BNP Paribas, will take control of much of Fortis, a Belgian and Dutch banking and insurance group. The Netherlands recently nationalized the group's Dutch operations. Europe's financial system has been hard-hit by the U.S. economic crisis.

In the United States, the battle between rivals Citigroup and Wells Fargo to take over troubled Wachovia Bank continues. Sunday a New York appeals court ruled that Wachovia cannot be forced to negotiate only with banking giant Citigroup. Citigroup had reached a preliminary agreement a week ago to buy Wachovia's banking assets, in a deal backed by the U.S. government. But on Friday Wells Fargo said it had signed an agreement with Wachovia to buy the entire company without government help.

VOA News - Asian Markets Open Sharply Lower

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UNCTAD: Asia Needs to Strengthen Banking, Finance Systems
03 October 2008 - The chief of the United Nations Conference on Trade and Development (UNCTAD) says Asia needs to strengthen regional financial regulations and cooperation to stem the impact from future financial downturns in the global economy.

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Supachai Panitchpakdi, UNCTAD secretary general, says the current global financial crisis provides Asia an opportunity to boost regional cooperation and regulation that could help strengthen banking systems. Asia's banking industry has undergone significant reforms since the region's financial crisis in the late 1990s when lending excesses led to scores of banks and finance companies closing, millions of jobs lost and a sharp contraction in regional economies. Supachai says the Association of South East Asian Nations (ASEAN) should take the lead in boosting intra-regional cooperation in the banking sector.

"Financial regulation within ASEAN, which could help to shield, to shelter the financial system in Asia, is going to be important - because fortunately this time the system has not been globalized enough to have been affected by the ongoings in the U.S. and EU," he said. "This is the time to be deepening the Asian financial system to set up the pooling of resources. Regional central banks have poured billions of dollars into credit markets over recent weeks to ease tight credit conditions since the financial crisis erupted in the United States in September. The central banks are also holders of billions of dollars of foreign exchange reserves.

Supachai's comments come as the U.S. House of Representatives Friday is expected to vote again on a revised $700 billion bailout plan after the bill was struck down Monday. The U.S. Senate voted overwhelmingly Wednesday for a revised package. Supachai says the rescue package must be seen only as a first step towards major reform of the U.S. financial system.

More VOA News - UNCTAD: Asia Needs to Strengthen Banking, Finance Systems