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O/T Asian Markets O/T 01/16/08

Discussion in 'Uncategorized Threads' started by Earl4140, Jan 15, 2008.

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  1. Earl4140

    Earl4140 TS Member

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    FWIW "Digg del.icio.us Newsvine Reddit FacebookWhat's this?HONG KONG (AP) — Asian stock markets plunged Wednesday on growing speculation the U.S. economy — a vital export market — is sliding into a recession that could lead to a global slowdown.

    Investors dumped stocks after an overnight sell-off in U.S. markets and on news that Citigroup Inc. had lost nearly $10 billion in the fourth quarter as it wrote down bad mortgage assets. Weak U.S. retail sales figures also added to the gloom, sending the Dow Jones industrial average down 277 points, or 2.2%.

    IN THE USA: Citigroup hammered by $10B loss. "The moves on Wall Street signal fears that the U.S. is going into recession," said Rommel Macapagal, chairman of Westlink Global Equities in Manila, where the market sank 2.7%.

    Such concerns are becoming widespread in Asia, he said. "We're all looking for new support levels."

    In Hong Kong, the benchmark Hang Seng index was down 4% at 24,815.61 in afternoon trading, while Tokyo's Nikkei 225 index fell 3.35% to close at 13,504.51 points.

    Markets in Australia, China, South Korea and New Zeland also fell sharply on worries about slower growth in the U.S. and around the world.

    The United States economy, battered by problems in the housing and credit markets, is a major export market for Asian companies, and weaker demand from American consumers will likely hurt profits at some of the region's companies. The U.S. Commerce Department said Tuesday that retail sales fell in December, and it revised the November figure lower.

    Investors saw more fallout from the subprime mortgage market when Citigroup said Tuesday it had written down $18.1 billion for bad mortgage assets.

    "The fallout from the Citigroup result is significant, with many saying ... there is more bad news to come," said Trent Muller, an ABN Amro Morgan analyst in Sydney, Australia. "We will see a bit of panic selling with a lot of investors taking cash off the table today."

    There is also a growing fear that the Federal Reserve hasn't done enough to keep the U.S. economy going. The central bank has lowered its key interest rate by a full percentage point to 4.25% since early August.

    Now many investors and analysts believe the Fed will cut rates by a half-point at its Jan. 29-30 meeting.

    "The risks of a recession in the United States appear to have increased," said David Cohen, director of Asian forecasting at Action Economics in Singapore. "It's still clearly up in the air and that is reflected in the volatility that we see in the markets day-to-day. Every new headline can spook the market."

    Japanese semiconductor stocks also fell after Intel Corp. shares plunged on concerns that the world's largest semiconductor maker is feeling the pinch of an ailing U.S. economy.

    A surge in the yen, which hurts Japan's vital exporters, also depressed Tokyo stocks. The U.S. dollar fell to 106.02 yen, the lowest level in 2 1/2 years.

    "The Tokyo market is very sensitive to the strong yen," said Tsuyoshi Nomaguchi, an analyst at Daiwa Securities Co. in Tokyo.

    In China, the benchmark Shanghai Composite Index fell 2.6% to 5,302.64 by midday. China shares, which are mostly isolated from world trends due to regulatory controls, have gained about 1% since the beginning of the year, compared with losses in several other Asian markets.

    But worries over the U.S. economic outlook and possible lending curbs by the central bank have hurt bank shares.

    "The market is divided over the potential impact the U.S. subprime crisis may have on China's economy, and Hong Kong's weak performance gave some jittery investors the final push to sell," said Essence Securities analyst Zhu Haibin.

    Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. Earl
     
  2. chuckles

    chuckles Member

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    Look for another big drop on Wall Street today as the big slide has started.

    regards
     
  3. Bocephas

    Bocephas Well-Known Member

    Joined:
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    Funny when the ship starts to sink the rat's are the first to jump off.

    Bo
     
  4. Capt. Morgan

    Capt. Morgan TS Member

    Joined:
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    " Funny when the ship starts to sink the rat's are the first to jump off."

    Why is that funny? It only proves again that rats are smarter than some people. It's a lot easier to recognize bad economic policy from the outside than from in the middle of it. When it's too late to do anything to help it, the next best thing is to get the heck out of the way while it falls and wait to see what's left when the dust clears.

    Morgan
     
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