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Asian Markets Tumble On Dubai Crisis

(RTTNews) - The markets across Asia ended sharply down in negative territory on Friday on concerns about financial crisis in Dubai. Investors across the world dumped high-risk stock investments and seek asylum in safe-haven government bonds.

In Japan, the benchmark Nikkei 225 Index slumped 301.72 points, or 3.22%, to 9,082 while the broader Topix index of all First Section issues declined 18.55 points, or 2.24%, to 811.

On the economic front, a statement released by the Ministry of Internal Affairs & Communications revealed that the unemployment rate in the country stood at a seasonally adjusted 5.1% in October, down from 5.3% in the previous month. Economists had expected the unemployment rate to rise to 5.4%. The unemployment rate stood at 3.8% a year ago.

The Ministry also revealed that Japan's general consumer prices dropped 2.5% year-on-year in October, after a 2.2% fall in prices in each of the previous three months. Core consumer prices, which excludes fresh food, dropped 2.2% in October from a year earlier, but slower than a 2.3% fall in the previous month. Economists expected a 2.4% decline. This is the eighth consecutive month that consumer prices have fallen.

In a separate statement, the Ministry of Economy, Trade & Industry revealed that retail sales in Japan dropped 0.9% year-on-year to JPY 10.83 trillion in October, slower than the 1.3% decline in the preceding month. Economists had expected sales to drop 1.6%. This marks the fourteenth straight month in which retail sales have fallen on an annual basis.

Almost all the stocks ended in negative territory mirroring the weak sentiment prevailing across the markets in the region.

Exporters declined on additional concerns about the strengthening of the local currency against the dollar. Canon Inc. declined 2.96%, Sharp Corp. fell 4.80% and Sony Corp. lost 4.43%.

Automakers also ended sharply lower. Toyota Motor declined 2.37%, Honda Motor lost 3.80%, Mitsubishi Motor slipped 1.75%, and Suzuki Motor fell 3.75%.

Banking stocks were the major losers. Sumitomo Mitsui Financial declined 3.68%, Mitsubishi UFJ Financial shed 2.20%, Mizuho Financial lost 3.27% and Resona Holdings fell 2.67%.

In Australia, the benchmark S&P/ASX200 Index slumped 136.50 points, or 2.90% to close at 4,572, while the All-Ordinaries Index ended at 4,597, representing a loss of 130.40 points, or 2.76%.

Almost all the stocks ended in the negative territory, impacted by the weak global sentiment on Dubai financial crisis.

Among the major banks, ANZ Bank declined 3.59%, Commonwealth Bank of Australia fell 3.40%, National Australia Bank lost 3.98% and Westpac Banking shed 3.83%. Investment banker Macquarie Group slumped 5.05%.

Metals and mining stocks also ended sharpy lower. BHP Billiton fell 3.37%, Rio Tinto lost 2.97%, Fortescue Metals shed 3.14%, Gindalbie Metals declined 2.69% and Oz Minerals plunged 5.98%.

Gold related stocks also ended lower. Lihir Gold declined 2.72%, Newcrest Mining lost 2.82% and Sino Gold Mining fell 2.01%.

Retail stocks, oil stocks and property stocks also ended in negative territory mirroring the weakness in the global markets.

In Hong Kong, the Hang Seng Index plunged 1,075.91 points, or 4.84%, to 21,134, mirroring the gloomy picture across the other Asian markets on concerns about the financial crisis in Dubai World and its cascading impact on banks and other institutions. All the 42 components in the index ended in negative territory with banks leading the decline amid huge volumes.

In South Korea, the KOSPI Index slumped 75.02 points or 4.69% to 1,524, tracking the other markets in the region on Dubai fears. All the components of the index ended in negative territory as traders preferred to switch to treasury and sold off stocks.

The Indian market extended its previous session's sharp sell-off on Friday, tracking weakness in overseas markets amid concerns surrounding Dubai. On Wednesday, Dubai asked the creditors of state-run Dubai world and its subsidiary Nakheel to agree a debt standstill for 6 months, sending shock waves through global financial markets. The BSE Sensex finished at 16,632, down 223 points or 1.32%, and the S&P CNX Nifty fell 64 points or 1.27% to 4,942.

All the other major markets in the region also ended in negative territory. China's Shanghai Composite Index declined 74.72 points or 2.36% to close at 3,097 and Taiwan's Weighted Index plunged 3.21%, or 248.25 points, to close at 7,491. The markets in Indonesia and Singapore are closed for holidays.

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