Arab Today, arab today asian markets slammed in global selloff
Last Updated : GMT 10:36:23
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Asian markets slammed in global selloff

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Arab Today, arab today Asian markets slammed in global selloff

Hong Kong - AFP

Asian stock markets on Friday caught a global selling fever after new warnings of world recession and as fears grew over the future of European banks with heavy exposure to sovereign debt. Investors across the region picked up on the mounting anxiety evident in the United States and Europe, where the markets saw fresh carnage on Thursday. Safe havens were the main beneficiaries, with gold hitting new highs and the yield on US 10-year Treasury bonds briefly touching a new low. Adding to woes in the region were fears that a slowdown in the galloping growth seen in China -- a key driver of the world economy -- could hit equities. \"Given the bloodbath seen across global equity markets overnight it is not at all surprising to see our market experiencing sharp and broad based losses,\" said IG Markets analyst Ben Potter in Australia, adding that there was no end in sight. \"From experience, these situations always go on for a lot longer than people think they should. \"Given the global financial crisis is still so fresh in people\'s minds, the market is going to have to do a lot to win back the confidence of investors, especially the retail sector.\" Tokyo tumbled 2.51 percent, hit by the double-whammy of global fears and the persistently strong yen, with the headline Nikkei index at down 224.52 points to 8,719.24. Sydney shed 3.51 percent. The benchmark S&P/ASX 200 was down 149.3 points at 4,101.9.  Seoul plunged 6.22 percent, with the benchmark KOSPI down 115.70 points at 1,744.88. South Korean exporters such as Samsung Electronics and Hyundai Motor bore the brunt of the losses. In afternoon trade Hong Kong was down 2.88 percent and Shanghai was off 1.37 percent. The worldwide selloff came after Wall Street investment bank Morgan Stanley warned that the US and eurozone economies were \"dangerously close\" to a double-dip recession. Stocks were further punished by a fresh round of gloomy economic data from the United States such as jobless claims, and growing doubts about the ability of European banks to withstand the 17-nation eurozone\'s debt crisis.  The Dow Jones Industrial Average was down 3.7 percent at the closing bell, while the broader S&P 500 slumped 4.5 percent and the tech-heavy Nasdaq Composite plummeted 5.2 percent. Losses were even worse in Europe on Thursday, as London stocks closed down 4.5 percent, Paris fell 5.5 percent and Frankfurt dropped 5.8 percent. Oil prices slumped as traders fretted that an economic downturn could erode global energy demand. Early in Asia, West Texas Intermediate crude for delivery in September was down $1.05 from its New York close at $81.33 a barrel. Gold and US Treasury bonds -- both safe havens in times of trouble -- broke record ground with bullion reaching $1,837.50 per ounce on the Hong Kong spot market from a previous high of $1,826.10 in New York. Yields on US 10-year Treasury bonds were down at one point Thursday to an all-time record low of 1.974 percent, breaking the record of 2.007 percent set on December 18, 2008, at the height of the US recession. By the end of the New York day, the 10-year Treasury yield was at 2.07 percent, compared to 2.17 percent late Wednesday, while the 30-year yield was at 3.42 percent, down from 3.57 percent.  Bond prices and yields move in opposite directions. A report in The Wall Street Journal that the US Federal Reserve was worried about the liquidity of major European banks contributed to the selloffs in European markets. French lenders came under especially intense pressure, with Societe Generale losing more than 12 percent. \"Europe is frankly a mess,\" said Mike Smith, head of one of Australia\'s big four banks, ANZ. \"And the United States, which I\'m normally much more optimistic about, we\'ve seen a crisis which was created by the partisan nature of its current politics. \"That\'s created further concern to what was already a pretty fragile recovery,\" said Smith. The tumult played out on the currency markets with the euro at $1.4303 and 109.39 Japanese yen, from $1.4337 and 109.70 yen late in New York. The yen was at 76.50 yen to the dollar in early Japanese trade, from 76.52 overnight in New York. Despite moves to stall its rise by the Swiss central bank, the Swiss franc strengthened to 1.1381 francs per euro, compared with 1.1464 francs late Thursday in Tokyo. But it fell to 0.7953 against the dollar from 0.7936. Concerns are not confined to the developed world. At Deutsche Bank, economists focused on the impact of slower Chinese growth on the rest of the world. They foresaw a \"soft landing\" for China this year and next, but concluded that \"global stock markets will likely be negatively impacted by a Chinese slowdown\". They said the world\'s second-biggest economy would grow 8.9 percent this year, down from 10.3 percent in 2010, and by 8.3 percent in 2012, \"mostly due to the effect of monetary tightening\". In other markets: Manila closed 1.44 percent, or 63.64 points, lower at 4,339.90. Metropolitan Bank and Trust Co. was down 2.89 percent to 73.80 pesos, while Philippine Long Distance Telephone Co. fell 0.59 percent to 2,332 pesos. Top-traded Lepanto Consolidated Mining Co. \"A\" shares were unchanged at 1.54 pesos. Taipei fell 3.57 percent, or 272.01 points, to 7,342.96. HTC was limit-down 7.0 percent to Tw$719.0 while Hon Hai fell 5.29 percent to Tw$68.0. Wellington closed down 0.56 percent, or 18.38 points, at 3,267.84, with a strong performance fro  

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