Asian Stocks.
March 18, 2008Asian stocks sank on Monday to their lowest since August and the dollar tumbled as the fire sale of U.S. bank Bear Stearns and the Federal Reserve’s emergency cut of a key lending rate sparked concerns that the global credit crisis will claim more casualties, Reuters reports.
European stocks were set to drop as well, with the FTSE’s 100 seen down as much as 1.8 percent and Germany’s DAX seen down 2.2 percent, while U.S. stock futures also pointed to a sharply lower session.
A Filipino trader gestures in front of a downward graph at the Philippine Stock Exchange on Monday. (Aaron Favila/The Associated Press)
The dollar sank to a record low against the euro and a 13-year low against the yen, sending spot gold and crude futures hurling toward record highs.
Other safe-haven assets also rose. Both Japanese government bond futures and U.S. Treasury futures rose to five-year highs.
“I’m sure we’ll see one or two other victims,” said Angus Gluskie, portfolio manager at White Funds Management in Sydney.
The currency market was also volatile on Monday in Asia, with the U.S. dollar falling as low as 95.72 yen, the lowest in more than 12 years, before rebounding to above the 99.00 level in afternoon on talk of possible joint governmental intervention to stop the slide. Japan’s Prime Minister Yasuo Fukuda hinted that his government might intervene the currency market, saying, “it is undesirable to see rapid changes” in foreign exchange rates and stock prices, the Kyodo News agency reported Monday afternoon.
Banking stocks led the plunge on Monday. Australia’s largest bank, Macquarie Group, slid 6.3%, or 3.00 Australian dollars ($2.82), to 44.50 Australian dollars ($41.76), while the country’s No. 2, Babcock & Brown, plunged 10.1%, or 1.38 Australian dollars ($1.30), to 12.26 Australian dollars ($11.51). Japan’s Mitsubishi UFJ fell 4.8%, or 40 yen (40 cents), to 789 yen ($7.97).
