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Asian shares extend losses, Greece fears grow
Source: Agencies |
October 4, 2011, Tuesday
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ASIAN markets mostly tumbled today after Wall Street slumped to its lowest level for more than a year as fears grow that Greece will default and the euro zone debt crisis will spread.
Tokyo fell 1.05 percent, or 89.36 points, to 8,456.12, while Seoul slumped 3.59 percent, or 63.46 points, to 1,706.19.
Sydney ended 0.64 percent, or 24.9 points, lower at 3,872.1 and China's Hong Kong was 0.64 percent down a day after the index slumped to its lowest level in more than two years.
Shanghai was closed for a public holiday.
The losses followed another slump on Wall Street, where the Dow shed 2.36 percent to finish at its lowest level since September 2010. The S&P 500 fell 2.85 percent and the Nasdaq lost 3.29 percent.
Euro zone finance ministers yesterday said they would once again delay releasing a much-needed eight billion euros to Greece to help it meet its debt obligations, saying it needed to do more to qualify for the cash.
World markets suffered heavy losses yesterday after Athens admitted at the weekend it would miss its deficit targets, adding to uncertainty over whether it would secure the next tranche of its multi-billion-euro bailout.
Euro group chairman Jean-Claude Juncker said yesterday that euro zone partners had asked the Greek government to take moves to ensure further savings in 2013 and 2014.
That would then lead to a "definite and final decision in the course of October" because Greece said it does not need eight billion euros in blocked loans until November.
However, despite Juncker saying he "firmly denied" any suggestion that Greece would be allowed to default on its debts, traders were panicked.
"The economic plight of Greece remains the key market-moving theme, as market participants continue to ponder the economic future of a nation seemingly on the verge of collapse," Chris Gore, currency strategist at GoMarkets in Melbourne, told Dow Jones Newswires.
On currency markets, the euro, which sank to fresh lows on Monday in New York, was slightly higher in early Asian trade.
The unit bought US$1.3210 after diving to US$1.3178, its lowest since January, while it edged up to 101.27 yen from a 10-year low of 100.96 yen in New York.
It also edged up slightly to 1.2143 Swiss francs from 1.2137.
The dollar bought 76.68 yen from 76.59 yen.
Japan's Finance Minister Jun Azumi on Tuesday called for the swift passage of the rescue package for Greece to reassure markets and help stem the yen's recent surge against the euro, which is hammering the country's exporters.
"We are seeing an extremely high yen and a weak euro," Azumi told reporters.
"The sense of uncertainty cannot be wiped out unless (euro member states) clearly show to the market the process of swiftly implementing the assistance scheme for Greece."
Adding to the impetus to sell are concerns that Belgium's Dexia bank, which needed to be rescued in the 2008 financial crisis, was in danger of being the first major European lender to become a victim of the sovereign debt crisis.
The bank's shares lost more than 10 percent on Monday on warnings of an imminent credit rating downgrade and wider fears of bank exposure to euro zone sovereign debt.
France and Belgium have announced they will "step in" if needed to save the troubled lender but the issue has highlighted concerns of a domino effect throughout Europe's banking system, which could spark another global downturn.
Oil continued to fall on demand fears. New York's main contract, light sweet crude for delivery in November, fell 87 cents to US$76.74 per barrel in the afternoon.
Brent North Sea crude for November delivery shed 83 cents to US$100.88.
By 0600 GMT gold was at US$1,670.30 an ounce.
Tokyo fell 1.05 percent, or 89.36 points, to 8,456.12, while Seoul slumped 3.59 percent, or 63.46 points, to 1,706.19.
Sydney ended 0.64 percent, or 24.9 points, lower at 3,872.1 and China's Hong Kong was 0.64 percent down a day after the index slumped to its lowest level in more than two years.
Shanghai was closed for a public holiday.
The losses followed another slump on Wall Street, where the Dow shed 2.36 percent to finish at its lowest level since September 2010. The S&P 500 fell 2.85 percent and the Nasdaq lost 3.29 percent.
Euro zone finance ministers yesterday said they would once again delay releasing a much-needed eight billion euros to Greece to help it meet its debt obligations, saying it needed to do more to qualify for the cash.
World markets suffered heavy losses yesterday after Athens admitted at the weekend it would miss its deficit targets, adding to uncertainty over whether it would secure the next tranche of its multi-billion-euro bailout.
Euro group chairman Jean-Claude Juncker said yesterday that euro zone partners had asked the Greek government to take moves to ensure further savings in 2013 and 2014.
That would then lead to a "definite and final decision in the course of October" because Greece said it does not need eight billion euros in blocked loans until November.
However, despite Juncker saying he "firmly denied" any suggestion that Greece would be allowed to default on its debts, traders were panicked.
"The economic plight of Greece remains the key market-moving theme, as market participants continue to ponder the economic future of a nation seemingly on the verge of collapse," Chris Gore, currency strategist at GoMarkets in Melbourne, told Dow Jones Newswires.
On currency markets, the euro, which sank to fresh lows on Monday in New York, was slightly higher in early Asian trade.
The unit bought US$1.3210 after diving to US$1.3178, its lowest since January, while it edged up to 101.27 yen from a 10-year low of 100.96 yen in New York.
It also edged up slightly to 1.2143 Swiss francs from 1.2137.
The dollar bought 76.68 yen from 76.59 yen.
Japan's Finance Minister Jun Azumi on Tuesday called for the swift passage of the rescue package for Greece to reassure markets and help stem the yen's recent surge against the euro, which is hammering the country's exporters.
"We are seeing an extremely high yen and a weak euro," Azumi told reporters.
"The sense of uncertainty cannot be wiped out unless (euro member states) clearly show to the market the process of swiftly implementing the assistance scheme for Greece."
Adding to the impetus to sell are concerns that Belgium's Dexia bank, which needed to be rescued in the 2008 financial crisis, was in danger of being the first major European lender to become a victim of the sovereign debt crisis.
The bank's shares lost more than 10 percent on Monday on warnings of an imminent credit rating downgrade and wider fears of bank exposure to euro zone sovereign debt.
France and Belgium have announced they will "step in" if needed to save the troubled lender but the issue has highlighted concerns of a domino effect throughout Europe's banking system, which could spark another global downturn.
Oil continued to fall on demand fears. New York's main contract, light sweet crude for delivery in November, fell 87 cents to US$76.74 per barrel in the afternoon.
Brent North Sea crude for November delivery shed 83 cents to US$100.88.
By 0600 GMT gold was at US$1,670.30 an ounce.
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