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US woes prompt Asian shares slump Markets steady after Asia falls
(about 2 hours later)
Asian shares slid after weak US jobs data raised fears about a possible recession in the region's biggest export market. European share markets have regained momentum after earlier Asian losses and last week's sell-off, triggered by fresh fears of a US recession.
Hong Kong's Hang Seng index slumped 2.7%, while Tokyo's main Nikkei index shed 1.3% having touched an 17-month low during trading. London's benchmark FTSE 100 index rose 18.6 points, or 0.3%, while Germany's Dax also gained 0.3%.
US Labor department data out late last week numbers showed that unemployment was at a two-year low in December. Investor nerves had been rattled by US Labor department data showing December unemployment at a two-year high.
This prompted a major sell-off on Wall Street, with the Nasdaq losing 3%. Wall Street blues sent Asian shares lower on Monday, with US concerns likely to weigh on shares this week.
Asian exporters, such as microchip firms, were hit by the disappointing US jobs data with Tokyo Electron falling 2.8%. "We've had a huge barrage of very bearish statistics last week from the US and it's obviously weighing on the market," said Edmund Shing, strategist at BNP Paribas in Paris.
Markets across the region suffered as investors sold shares considered risky, and bought Japanese and US government bonds - which are seen as safe havens when economic growth is uncertain. "The question this week is: 'are we ready for a short-term bounce, or are we going to crack through the support levels and go further down?' My view is that we'll get a small bounce because we're getting oversold on a number of indices," he said.
The Hang Seng closed at 26.776.5 points while the Nikkei index ended trading at 14,500.5. Fragile sentiment
The US is Asia's biggest export market and fears exist that a slowdown in the world's largest economy will hurt the region's exporters and subsequently economic growth.
Hong Kong's Hang Seng index fell 2.7%, closing at 26.776.5 points , while Tokyo's main Nikkei index shed 1.3% and ended at 14,500.5 points having touched a 17-month low during earlier trade.
Asian exporters, such as microchip firms, were hit by Friday's jobs data, with Tokyo Electron falling 2.8%.
Markets across the region suffered as investors sold shares considered risky, and bought Japanese and US government bonds, seen as safe havens in times of uncertain economic growth.
Taiwan's main index shed 4.1%, while Australian and Singapore markets fell by more than 2% each.Taiwan's main index shed 4.1%, while Australian and Singapore markets fell by more than 2% each.
"The sluggish jobs data is reinforcing concerns that the sub-prime mortgage crisis is pushing the US economy towards a recession," said Kim Young-gak, an analyst at Hyundai Securities."The sluggish jobs data is reinforcing concerns that the sub-prime mortgage crisis is pushing the US economy towards a recession," said Kim Young-gak, an analyst at Hyundai Securities.
He said it was now likely that the US Federal Reserve would have to cut interest rates this month to boost the country's housing market and lift confidence in global economic growth. The US Federal Reserve is likely to cut interest rates this month, he said, as part of efforts to boost the country's housing market and lift confidence in global economic growth.