Tuesday, September 30, 2008

Asian Markets Fall Sharply at Opening

The historic carnage on Wall Street spread to Asia Tuesday, with stocks across the region plunging after Congress rejected a rescue plan that investors had hoped would bolster volatile financial markets.

All major stock markets in the region tumbled sharply, succumbing to heightened fears of a broader global credit crisis.

Japan's benchmark Nikkei 225 index shed more than 544 points, or 4.6 percent, to 11,199.07 after losing 1.3 percent Monday.

Key indices in Australia and New Zealand were both down about 4 percent, Seoul's Kospi lost 3.5 percent, and Hong Kong's Hang Seng index declined 5.5 percent.

The weighted price index of the Taiwan Stock market, which was closed Monday due to a typhoon, fell 6.1 percent, even after Taiwanese Vice Premier Paul Chiu urged investors to have confidence in the island's export-driven economy and its financial markets.

The selling in Asia came after world stock markets tumbled Monday amid a flurry of government bank rescues in Europe that had investors on edge even before the House voted to reject the Bush administration's rescue plan.

The House of Representatives on Monday defeated a $700 billion emergency bailout package for the U.S. financial system, shocking capital and stock markets around the world. The Dow Jones industrial average closed down 777 points, its biggest single-day fall, topping the 684 points it lost on the first day of trading after the Sept. 11, 2001, terrorist attacks.

The downturn sapped the dollar overnight. The greenback was trading at 103.90 yen Tuesday morning in Asia from above 106 yen a day earlier, adding further pressure on major exporters.

Latin American markets were still open when news that lawmakers on Capitol Hill had rejected the bailout sent investors running for the exits from Mexico City to Buenos Aires.

Stocks in Europe had earlier ended lower, although less dramatically, as market players fretted about the health of the world's financial system, even with a U.S. bailout.

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