Asian stocks plunged on Friday as fresh fears about Spanish banks added to existing worries about capital flight from Greek lenders, wiping out hundreds of billions of dollars in the region’s market capitalization.
Japan’s Nikkei 225 Index collapsed 265.28 points, or 3%, to 8,611.31, to take losses for a seventh straight week.
The Hang Seng Index in Hong Kong capsized 249.08 points, or 1.3%, to 18,951.85.clinching its 11th loss in 12 trading days, and following in the footsteps of U.S. equities. The index is now among the worst performing in the region so far this month, having lost 10.2% of its value.
More than $240 billion in investor wealth was erased during the session from just the six regional markets mentioned above, with shares listed on the Tokyo Stock Exchange alone losing $110 billion, according to data from FactSet Research.
The performance capped a terrible week for markets, with South Korea’s Kospi losing the most, at 7%. The S&P/ASX 200 shed 5.6% this week and the Shanghai Composite gave up 2.1%, while losses for other indexes fell between those values.
A big portion of the recent losses came as reports emerged about depositors taking large sums out of Greek banks, on fear that upcoming elections in June could lead the country out of the euro-zone.
But Friday’s losses came a day after ratings agency Moody’s downgraded 16 Spanish banks, and as shares of Spanish lender Bankia S.A. dropped 14% Thursday on reports customers were pulling money out of the nationalized lender.
Europe is one of Asia’s most important trading partners, and concerns about the banking sector only exacerbated broader worries about the health of the European economy, as the euro hovered around a four-month low against the U.S dollar in Asia on Friday.
Several regional stocks with a large international presence received a thrashing.
In Japan, Honda Motor Co. sank 3.6%, Toyota Motor Corp. lost 3.7% and Sony Corp. plunged 5.3%.
Hong Kong apparel retailer Esprit Holdings Ltd., which has significant exposure to Europe, dropped 4.1%, and Hon Hai Precision Industry Co. skidded 2.9% in Taipei.
And in Seoul, Hyundai Motor Co. dropped 4.8%, while shares of its affiliate Kia Motors Corp. contracted 5.7%.
Among mining and metal stocks, Fortescue Metals Group Ltd. and Rio Tinto Ltd. each dropped 5.1%.
Aluminum Corp. of China Ltd fell 1.5% and coal miner China Shenhua Energy Co. declined 3.4% in Hong Kong; in Shanghai, they lost 0.4% and 1.4%, respectively.
Financials were among the hardest hit stocks. Heavyweight HSBC Holdings PLC dropped 3.1% and Standard Chartered PLC fell 3.4% in Hong Kong; in Tokyo, Nomura Holdings Inc. fell 5.6% and Mitsubishi UFJ Financial Group Inc. gave back 3.4%.
Shares of Westpac Banking Corp. fell 3.8% in Sydney, while KB Financial Group Inc. declined 3.4% in Seoul.
In other markets;
Shanghai’s CSI 300 Composite Index removed 39.97 points, or 1.5%, to 2,573.98
Singapore's Straits Times Index shed 43.51 points, or 1.5%, to 2,779.10
Korea’s Kospi Index fell 62.78 points, or 3.4%, to 1,782.46
Taiwan’s Taiex Index jettisoned 205.58 points, or 2.8%, to 7,151.19
New Zealand’s NXZ Index let go of 20.07 points, or 0.6%, to 3,501.44
Australia’s ASX Index doffed 110.96 points, or 2.7%, to 4,046.46
