Asia resumes free fall

GLOBAL MARKETS/ STOCK REPORT

Asian stocks plunged for a second day, sending the region's benchmark to its biggest decline since April 1990, on concern the global economy is slowing.

BHP Billiton fell after metals and oil prices dropped, pushing Australia's stock index to its steepest loss in almost 20 years.

PetroChina, the nation's largest oil explorer, slumped, helping drag Hong Kong's Hang Seng Index to the biggest two-day drop since October 1997. Toyota Motor declined as Japan's benchmark sank to the lowest since September 2005.

"We're in panic territory," said Patrick Chang, who helps manage $4.5 billion at CIMB-Principal Asset Management in Kuala Lumpur.

"The markets are pricing in a recession. We won't see a bottom for the next one-to-two weeks."

The MSCI Asia Pacific Index tumbled 6.5 per cent to 132 at 7:29 pm in Tokyo, following Europe into a bear market and extending a global slump that has wiped more than $5 trillion from stock markets this year.

Standard & Poor's 500 Index futures point to a 4.7 per cent decline when US trading starts. Japan's Nikkei 225 Stock Average sank 5.7 per cent to 12,573. Australia's All Ordinaries Index fell 7.3 per cent, the most since October 1989. The BSE Sensex fell 5 per cent, paring a loss of 13 per cent earlier in the day.

EUROPE
European stocks pared earlier declines as UBS and ArcelorMittal advanced.

The Dow Jones Stoxx 600 Index fell 0.7 per cent as of 9:10 am in London, after earlier dropping as much as 4.1 per cent. The Stoxx 50 slid one per cent, and the Euro Stoxx 50, a measure for the euro region, sank 1.5 per cent.

UBS, Europe's largest bank by assets, added 3.3 per cent to 41.64 Swiss francs. ArcelorMittal, the world's biggest steelmaker, advanced 1.7 per cent to 38.59 euros.

US
US stock-index futures slumped, indicating the Standard & Poor's 500 Index may drop the most since the September 11 terrorist attacks when the market opens. Exxon Mobil, the largest oil company, and Barrick Gold, the biggest gold producer, may lead commodities shares lower as crude and metal prices fell.

S&P 500 Index futures expiring in March dropped 61 points, or 4.7 per cent, to 1,263.40 as of 9:08 am in London. The index tumbled 4.9 per cent when the market reopened following the 2001 terrorist attacks. Dow Jones Industrial Average futures sank 583 points to 11,523. Nasdaq-100 Index futures lost 82.5 points to 1,767.

"Investors are panicking across the board," said Chirin Gill, who helps manage the equivalent of $3 billion at Daiwa SB Investments in London.

"All of the economic data coming out of the U.S. points to a severe weakening in macro conditions."