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Asian stocks stumble over news of deepening US recession
Asian stocks stumbled on Wednesday after downbeat data about the US economy showed the recession there was deepening.
- AP
- Published: 11:19 December 24, 2008
Hong Kong: Asian stocks stumbled on Wednesday after downbeat data about the US economy showed the recession there was deepening.
Japan's Nikkei 225 stock average dropped 198.68 points, or 2.3 per cent, to 8,525.10, after being closed on Tuesday for a holiday.
Shares in Toyota Motor Corp. tumbled 4 per cent in their first trading day since Monday, when the world's largest automaker said it expected to post its first operating loss in almost 70 years. Automakers across the region were hit with heavy selling as well.
Hong Kong's Hang Seng Index closed down 0.3 percent to 14,184.14, while South Korea's Kospi lost -1.3 percent to 1,129.14.
"The end-of-the-year, bear-market, feel-good rally is ending sooner than many expected," said Kirby Daley, senior strategist at Newedge Group in Hong Kong.
"Investors are being hit in the face with the reality of just how bad the US economy is and they're seeing firsthand the effects this is having on the consumer and, as a result, companies like Toyota and US retailers."
Elsewhere, Shanghai's benchmark lost over 1 per cent, while key indices in Australia, Taiwan and Singapore gained. Trading was feather-light throughout Asia, and some markets closed early for the holiday.
Many investors found little reason to buy after reports released overnight in the US showed no signs of a turnaround in the world's largest economy, already in recession.
The government said third-quarter gross domestic product fell at an annual rate of 0.5 per cent. The hard-hit housing sector also continued to deteriorate. New home sales weakened last month to the slowest pace in nearly 18 years, and prices of new homes dropped by the biggest amount in eight months.
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