Asian markets crumbled Wednesday, as investors alarmed by a deteriorating financial markets situation dumped blue-chip stocks to raise cash, sending several indexes tumbling down to multi-year lows.
In Tokyo, the benchmark Nikkei 225 index plunged 952.58 points, or 9.4%, to close at over five-year lows of 9,203.32, while In Hong Kong, the Hang Seng index closed down 1,372.03 points or 8.17% at the day's low of 15,431.73.
On the economic front, the Conference Board reported Tuesday that its leading economic index for Japan decreased 0.6 percent in August. The board's coincident index also fell 0.6 percent. Among other data released today, the number of bankruptcies shot up 10.2% on month and 42.9% annually in September, while Eco watchers survey showed that the current index stood at 28 in September compared to 28.3 last month and outlook index fell to 32.1 from 32 in August.
Meanwhile, the Bank of Japan said in its monthly economic assessment report for October that Japan's economic growth will likely remain sluggish for the time being as a slowdown in overseas economies became more evident. However, the economy is expected to return gradually onto a moderate growth path in the longer run as the effects of earlier increases in energy and materials prices abate and overseas economies move out of their deceleration phase. The central bank's assessment was almost similar to the one in September.
Among banks, Mizuho Financial Group plunged 7.7%, Sumitomo Mitsui Financial Group fell 6.5%, and Resona Holdings slumped 10.1%. Mitsubishi UFJ, which is investing $9 billion in Morgan Stanley, lost 5.9% after Morgan Stanley's shares fell about 40% overnight. Nomura Holdings, Japan's largest brokerage firm, tumbled 6.3%.
Exporters fell on the back of a stronger yen. Automaker Honda Motor plummeted 10.3%, Toyota Motor sank 11.6% on a Nikkei daily that the company's consolidated operating profit for the year ending March 31 will drop 40%, electronics giant Sony declined 12.3%, heavy machinery maker Komatsu lost 12.4%, and Advantest plummeted 14.9%.
Nippon Steel lost 11.9% and shipping firm Mitsui OSK Lines shed 12.8%. Hitachi Construction Machinery plunged 16.5% after the Nikkei business paper reported that Hitachi Construction could see a first profit decline in seven years in the year to March 2009 due to a sharp fall in demand in Europe and signs of weakening sales in countries emerging markets.
CHINA
The Chinese stock market closed sharply lower for the third straight trading session, led by financial stocks, amid escalating fears over the global credit crisis. The benchmark Shanghai Composite Index closed down 65.62 points or 3.04% at 2,092.22. The index has fallen nearly 202 points or about 8.8% in the first three trading days of this month.
Among banks, China Merchants Bank plunged 8.3%, China Construction Bank fell 5.4%, and Industrial and Commercial Bank of China dropped 2.2%. Elsewhere in the financial sector, Ping An Insurance tumbled 9.2% and China Life Insurance plummeted 9.1%.
Property developers were weaker after China Vanke reported a 37.9% decline in September sales on year-over-year basis. China Vanke lost 1.1%, Poly Real Estate declined 1.4%, and China Merchants Property Development gave away 2.7%.
Airlines retreated after oil prices rose overnight, while gold producers gained on rising gold prices. China Eastern Airlines shed 5.2%, Air China slumped 7.4%, and China Southern Airlines declined 6.1%. Zijin Mining rose 2.3%, while Shandong Gold-Mining and Zhongjin Gold both rose by the 10% daily limit.
Brokerages remained under pressure due to profit taking. Haitong Securities sank 9.0% and CITIC Securities fell 6.6%.
Elsewhere:
Taiwan's Taiex closed down 5.8% at 5,206.
Singapore's STI closed down 6.6% at 2,033.
Malaysia's KLCI closed down 2.7% at 970.
Indonesia's Jakarta Composite index closed down 10.4% at 1,451.
South Korea's Kospi lost 5.8% to 1,286.69.
New Zealand's NZX 50 index gave up 1.9% to 2,948.31.
The benchmark S&P/ASX 200 index closed down 230.6 points, or 5.0%, at 4,388.1.
with files from other wire services
