Don't miss

Replay


LATEST SHOWS

THE INTERVIEW

Rwandan president claims 'no problem with France'

Read more

EYE ON AFRICA

Paul Kagame visits UNESCO HQ in Paris

Read more

MEDIAWATCH

Flamboyant US Congressman's Instagram Lands Him in Bother

Read more

THE WORLD THIS WEEK

Compromise buys Greece time and Jihadi John is unmasked (part 2)

Read more

THE WORLD THIS WEEK

Compromise buys Greece time and Jihadi John is unmasked (part 1)

Read more

#TECH 24

Drone vs. drone

Read more

FRANCE IN FOCUS

The future of agriculture

Read more

REVISITED

Yalta, the symbol of a new Cold War?

Read more

#THE 51%

Women in the workforce: IMF says closing the gender gap makes economic sense

Read more

Asian stocks plunge, dollar drops

Video by FRANCE 24

Latest update : 2008-12-12

Following the US Senate's failure to pass an auto industry bailout bill, Asian stocks nosedived, dragging the dollar to a 13-year low against the Japanese yen.

REUTERS - Asian stocks fell sharply on Friday after failure to find a compromise on a $14 billion carmaker bailout in the U.S. Senate put the industry in jeopardy, pushing up U.S. government debt and dragging down the dollar.

 

U.S. stock futures gapped lower and oil prices extended losses to trade below $46 a barrel after the majority leader of the U.S. Senate said a procedural vote over the bailout would be held later, but predicted it would not pass.

 

Asian shares had already been under pressure before the auto industry news because of unease about the shrinking financial sector and economic malaise, which doused the bargain hunting that had helped to drive up shares in the last week.

 

"It shouldn't come as a surprise that Asian equity markets are selling off today on news of the U.S. auto bailout failure," said Tim Rocks, equity strategist with Macquarie Securities in Hong Kong.

 

"For Asia, the major issue is how much damage is being done to earnings and balance sheets, and we won't know until February when companies announce fourth-quarter earnings," he said.

 

The MSCI index of Asia-Pacific stocks outside Japan fell 4.8 percent, eroding more of its double-digit percentage gains in the last week.

 

Japan's Nikkei share average sank 5.3 percent, snapping four days of rises.

 

Shares of Toyota Motor Co were off 10 percent and Honda Motor Co off 13 percent as investors bailed on any firm remotely connected with U.S. car companies.

 

 Hong Kong's Hang Seng index was down about 6 percent, weighed down by HSBC's almost 2 percent fall.

 

The dollar fell to below 90 yen, its lowest in 13 years.

 

The yield on the benchmark 10-year note, which moves in the opposite direction of the price, slipped to 2.54 percent, down 8 basis points from late New York.

Date created : 2008-12-12

COMMENT(S)