Asian markets in freefall on doubt over bail-out's success

TOKYO - Markets across Asia plummeted Thursday, dragged down by US retail sales data and concerns about whether bank bail-outs would be able to rescue financial markets and avert a recession.

By (DPA)

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Published: Thu 16 Oct 2008, 5:01 PM

Last updated: Sun 5 Apr 2015, 2:19 PM

The Tokyo stock market plummeted more than 11 per cent after Wall Street's blue-chip Dow Jones industrials lost nearly 8 per cent overnight amid growing recession fears in the United States and worldwide.

The benchmark Nikkei 225 Stock Average plunged 1,089.02 points, or 11.41 per cent, to close at 8,458.45. It the biggest one-day plunge in 21 years.

The broader Topix index of all first-section issues also lost 90.99 points, or 9.52 per cent, to 864.52.

Japan's central bank injected 600 billion yen (5.92 billion dollars) into money markets to ease the credit crunch that has resulted from the global financial crisis.

Hong Kong's Hang Seng Index, fell nearly 5 per cent on the global doom. The blue-chip index, fell 767.78 points, or 4.8 per cent, to close at 15,230.52, climbing slightly after falling 7.5 per cent by lunchtime.

The losses marked the second-consecutive day that the blue-chip index has fallen by around 5 per cent after strong gains earlier in the week when bank deposit guarantees were announced worldwide.

Taiwan's Taiex index, which opened sharply lower, closed 3.25 per cent lower at 5,075.97, dampened by Wall Street woes . A bullish measure by the government to cut the island's inheritance and gift tax rate to 10 per cent failed to inspire traders. Stocks of all six listed companies of the Formosa Group fell sharply on the death of the petrochemical giant's founder Wang Yung-ching, dubbed the "god of management" and the second-wealthiest man in Taiwan.

Investors fled Australian stocks in response to Wall Street registering its biggest one-day percentage loss in 20 years. The ASX 200 fell 286 points, or 7.1 per cent, to 4,013.

Macquarie Bank economist Martin Laycoss said the slippage was a "follow-through from Wall Street's 7.8-per-cent fall. It was impossible for us to ignore that."

New Zealand's benchmark NZX 50 index followed the week's international roller coaster trend, closing down 4.8 per cent after posting its biggest ever one-day jump of nearly 6 per cent on Tuesday, ended down 139.95 points at 2,764.68.

In China, the key Shanghai Composite index was down 4.25 per cent to 1,909.94. The smaller Shenzhen Component index was also down 4.25 per cent to 500.3.

Singapore's Straits Times Index plunged 5.25 per cent to 1,951.2.

In Seoul, South Korea's Kospi index nosedived 9.44 per cent to 1,213.78 after the ratings agency Standard and Poor's said Wednesday that it might cut credit ratings for a number of South Korean banks.

Philippine shares dipped 5.18 per cent tracking losses on other Asian stock markets. The Philippine Stock Exchange's 30-share composite index slipped 116.04 points to close at 2,122.37.

Indonesian shares were down 3.76 per cent, the Jakarta Composite index closed at 1,463.25, down 57.16 points, while Thai shares seemed exempt from the plummet, dropping only 0.78 per cent. The Stock Exchange of Thailand (SET) index was down 3.8 points to 477.73. Shares in India also plunged shortly after opening, however, gained ground later in the day. The 30-share Sensex of the Bombay Stock Exchange traded down 2.51 per cent at 10,538.17. Similarly, the broader 50-share Nifty index dropped 2.49 per cent to 3,255.3.

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