US fears hit Asian scrips

GLOBAL MARKETS

Asian stocks tumbled to the lowest in two months, extending a worldwide selloff that wiped $1.5 trillion from the value of global shares, on concern US growth will stall.

Toyota Motor Corp led Japan's stocks to the biggest decline since June after a government report showed consumer confidence dropped in the US, Asia's biggest export market. HSBC Holdings dragged Hong Kong's Hang Seng Index to its largest points drop since September 12, 2001, on concern it would report weaker profits today because of defaults on high-risk mortgages in America.

"Investors may remain bearish all week as expectations over solid US consumption have dropped,'' said Masaaki Endo, who helps oversee $10 billion at Norinchukin Zenkyoren Asset Management Co in Tokyo. "The global plunge made people sensitive to risk.''

The Morgan Stanley Capital International Asia-Pacific Index slid 2.8 per cent to 138.74 at 8:04 pm in Tokyo, its lowest since January 12. The measure fell 3.5 per cent last week, the most since July.

Just 22 of its 1,069 stocks advanced. More than $166 billion in market value was erased from Tokyo Stock Exchange's first section today. Japan's Nikkei 225 Stock Average lost 3.3 per cent, the most since June 13. Sony Corp and Canon led declines as the yen rose against the dollar and euro, reducing the value of overseas sales.

The Hang Seng lost 4 per cent, with the benchmark losing about $280 billion in value in the past week. All markets open for trading fell. Thailand was closed for a holiday.

US stocks had their worst week since January 2003, sliding to a three-month low on March 2. Futures on the Standard & Poor's 500 Index recently fell 0.9 per cent.

Nasdaq Composite Index futures declined 1.1 per cent.

China Minsheng Banking Corp led China's stocks lower after Premier Wen Jiabao said the country will take more steps to curb investment and slow economic growth.

US stocks dropped after a decline in consumer confidence magnified the risk that profit growth will be wiped out by a recession. All three US benchmarks erased their year-to-date gains as about $837 billion of market value was lost in the world's biggest economy.

A worldwide stock-market rout began in China on February 27 amid concern the government would tighten investment controls. Last week the S&P's 500 Index fell 4.4 per cent while the Nasdaq dropped 5.9 per cent.

Toyota, the world's second-biggest automaker, dropped 3.2 per cent to 7,460 yen. BHP Billiton fell 2.9 per cent to A$26.34.

Posco, the world's No 3 steelmaker, slumped 8.5 per cent to 333,500 won.

The Morgan Stanley Capital International's Emerging Markets Index fell 3.7 per cent to 844.74, adding to a four-day, 6.7 per cent slump. The Kuala Lumpur Composite Index plunged 4.7 per cent. The Philippine Stock Exchange index lost 4.5 per cent. Gauges in Taiwan, South Korea, India and Indonesia all fell more than 2.5 per cent.

Japanese exporters were pushed lower as the yen rose against the dollar and euro, reducing the value of overseas sales in local-currency terms and making their products less competitive.

Sony, the world's No 1 video-game console maker, declined 2.9 per cent to 5,660 yen. Overseas sales accounted for 70 per cent of Sony's total sales last year. Canon, the world's No 1 digital-camera maker, dropped 2.1 per cent to 6,130 yen.