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Most Asian markets extend slump amid finance gloom
2009-03-02
HONG KONG - Most Asian stock markets extended their slump Tuesday after unremitting troubles at financial giants like American International Group and HSBC sent Wall Street tumbling to new multiyear lows overnight. Declines across the region added to a global sell-off that started last week as the world economic slump showed no signs of abating and financial firms, despite billions in government aid, continued reeling from losses. The pain spread Monday after AIG announced a stunning $62 billion loss for the fourth quarter -- the biggest in U.S. corporate history -- and accepted another $30 billion in bailout money from the government. In Europe, HSBC Holdings PLC, said it needs to raise about $18 billion and reported a 70 percent drop in earnings for last year. Shares in HSBC, Europe's largest bank by market value, plunged nearly 18 percent in Hong Kong trade. With no end to the economic crisis in sight, markets in the U.S. and Europe plummeted overnight, and the Dow Jones benchmark finished below 7,000 for the first time since May 1, 1997. "There's just a lot of fear driving the markets right now," said Lucinda Chan, a director at Macquarie Private Wealth in Sydney. "The market is consumed by the global sell-down at the moment, and I think there's going to be more pain before there's a turnaround." Tokyo's benchmark Nikkei 225 stock average lost 27.18 points, or 0.4 percent, to 7,252.97, after a 3.8 percent drop Monday. Earlier in the day, the key index dipped below its lowest close in 26 years, set Oct. 27. It remained just above a 26-year intraday low of 6,994.90 reached Oct. 28. In Hong Kong, the Hang Seng lost 182.71 points, or 1.5 percent, to 12,134.75. Shanghai's key index was off 1.3 percent, with markets in Australia and Taiwan also losing ground. Elsewhere, South Korea's Kospi gained 0.1 percent to 1,019.87. Overnight in New York, the Dow tumbled 299.64, or 4.2 percent, to 6,763.29. It last closed below 7,000 on May 1, 1997. Broader benchmarks also ended down, with the Standard & Poor's 500 stock index losing 34.27 points, or -4.7 percent, to 700.82. During the session, the measure dipped below the psychologically important 700 level. It hadn't traded below 700 since October 1996. Wall Street looked to recover some if its losses after U.S. futures edged higher. Dow futures were up 80, or 1.2 percent, at 6,870 and S&P500 futures climbed 9, or 1.3 percent, to 714.50. Oil prices were higher after plunging overnight, with light, sweet crude for April delivery up 21 cents at $40.36 a barrel in Asian trade. On Monday, the contract plummeted $4.61, or more than 10 percent, to settle at $40.15 on the New York Mercantile Exchange. In currencies, the dollar strengthened to 97.47 yen from 97.11 yen. The euro weakened to $1.2620 from $1.686.
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