Asian stocks rattled by US falls
Asian stocks fell sharply on Tuesday amid renewed fears over the health of the global financial sector and after US stocks hit a near 12-year low.
Japan's Nikkei index closed down 1.46%, the Hong Kong index closed down 2.9% and the Shanghai index fell 4.3%.
South Korean Kospi share index dropped 3.2%, while indexes in Singapore and Taiwan shed more than 1%.
In Japan the finance minister said the government may consider a call to buy shares to support the stock market.
The proposal came after Japanese shares fell to near 26-year lows on Tuesday.
Finance Minister Kaoru Yosano said he told officials to look into ways to support the stock market, including setting up a government body to buy shares.
“ Investors are just selling out in disgust across the board ”
Lorraine Tan, Standard & Poor's
BBC economics correspondent Andrew Walker said a similar scheme was tried in the 1990s, and was "not very successful".
"In the case of Japan share prices are especially important to banks who are large shareholders," our correspondent said.
"They have not invested heavily in the problem assets that have undermined western banks, but a further heavy fall in share prices could do them serious damage."
Most Asian indexes had risen on Monday on hopes the US government was to increase its stake in Citigroup.
However, no formal move was made. US regulators said they were considering boosting government ownership in financial institutions, but without going all the way and nationalising them.
On Monday in the US, the Dow Jones Industrial Average closed down 250.9 points, or 3.4%, at 7,114.8, its lowest level since October 1997.
The tech-heavy Nasdaq index closed down 3.7%, while the Standard & Poor's 500 index fell 3.5% to 743.33, its lowest finish since 11 April, 1997.
No end in sight?
"Investors are just selling out in disgust across the board - disgust with the market, disgust with the financial problems," said Lorraine Tan, director of equities research at Standard & Poor's in Singapore.
"The government seems to keep throwing in money, but there doesn't seem to be any end to the declines or solutions to the problems," she said.
The Shanghai benchmark index fell as China's central bank said the country's economic downturn could worsen.
Meanwhile the index of Asia-Pacific stocks outside Japan, the MSCI, also fell, by 2.3%. And Australia's stock market was also down, by 0.6%. The Indian Sensex was down slightly, by 0.24%.
Among Asian financial shares, Nomura Holdings, Japan's biggest broker, lost 9.3% after announcing plans to raise $3.3bn.
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Published: 2009/02/24 12:53:50 GMT