Asian stocks tumble to three year low
Asian stocks tumble to three year low
Asian stocks tumbled, pushing the region's benchmark index to the lowest level in three years, as credit markets seized up and concerns grew that more financial companies will collapse.
Macquarie Group Ltd., Australia's largest investment bank, plunged by a record 23 percent as Morgan Stanley and HBOS Plc sought buyers. Newcrest Mining Ltd. rose as gold extended its biggest jump in 26 years. U.S. three-month Treasury yields traded near the lowest since World War II as investors fled stocks for safer havens.
"Confidence has been shattered,'' said Nader Naeimi, a Sydney-based senior investment strategist at AMP Capital Investors, which manages about $108 billion.
"The market is worried about a domino effect in the financial sector, with no one sure who's going to fall next.''
The MSCI Asia Pacific Index dropped 1.7 percent to 108.74 as of 7:39 p.m. in Tokyo, the lowest since Sept. 16, 2005.
The index trimmed an earlier 4.3 percent drop after the Federal Reserve, the European Central Bank and the Bank of Japan moved to pump dollars into the financial system. Hong Kong's Hang Seng Index rallied from a 7.7 percent loss to close little changed.
Most benchmark indexes in the region fell. Japan's Nikkei 225 Stock Average lost 2.2 percent to 11,489.30, led by Sony Corp. after Goldman Sachs Group Inc. cut its recommendation.
Taiwan's Taiex index lost 2.7 percent, prompting the government to announce it may buy shares to help prop up the market.
The central bank action, which was announced after Japanese and South Korean markets closed, is aimed at heading off the credit crisis that has caused Lehman Brothers Holdings Inc.'s bankruptcy and the takeover of American International Group Inc. by the U.S. government.
