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Asian stocks down on credit fears | Asian stocks down on credit fears |
(30 minutes later) | |
Asian stocks have slumped, as resurgent credit fears have pushed the value of the US dollar down further, harming export-oriented firms. | |
Tokyo's Nikkei ended 2.48% down at 15,197.09 and the broader Topix slid 2.54% to 1,456.40 - both 15-year lows. Hong Kong's Hang Seng Index fell 4.5%. | |
Also lower was Singapore's Straits Times Index, which fell 2.8%, | |
Analysts said the trend was in response to Friday's falls in the US, as fears of the credit crisis continue. | |
'Scary' | |
"I'm afraid factors from overseas, such as sub-prime problems, are coming over to Japan," said Chief Cabinet Secretary Nobutaka Machimura. "We'll closely monitor the situation," he added. | |
What started as problem in the US housing market, with default rates on mortgages rising in the wake of a series of interest rates rises, later spread to other markets. | |
As banks begin to reveal their exposure to the sub-prime sector - which specialises in lending to riskier borrowers - there are increasing fears that greater financial losses lie ahead. | |
The Dow Jones Industrial Average fell 1.8% on Friday after Wachovia bank said its writedowns on bad mortgage debt would total $1.1bn (£525m) for October alone. | |
One trader in Japan said: "Its getting to the point where everything seems scary and that its hard to trust what financial institutions are saying." | One trader in Japan said: "Its getting to the point where everything seems scary and that its hard to trust what financial institutions are saying." |
Other fallers in Asia included China's Shanghai Composite Index, down 2.9%. At the weekend, China's central bank made a move to cool inflation by raising the level of deposits that commercial banks must set aside. |