Asian Shares Fall Again as Japanese Market Sheds More Than 9 Percent | Voice of America - English
Asian share prices have fallen for a third day as investors feared a global recession would badly hit company earnings.  Japan's Nikkei index closed at a five-and-a-half year low, down 9.6 percent after the country's electronics giant Sony halved its full-year profit forecasts.  In Australia, the government has been forced to amend its promise to guarantee all bank deposits, amid concerns that non-bank institutions not covered by the plan would be destabilized.
It has been another day of carnage on Asian stock markets. Some of the worst pain Friday was felt in Tokyo, where the Nikkei fell below the 8,000 mark for the first time in more than five years as investors were again spooked by fears of a global recession. The strength of the Japanese yen is causing concerns about the country's export earnings, as the dollar fell below 96 yen, its lowest level in 13 years. A stronger yen makes Japanese exports more expensive on world markets. Stock markets across Asia followed the Nikkei's slide. Seoul's benchmark Kospi index closed below 1,000 points for the first time since May 2005. The main indexes in Mumbai and Singapore were down more than seven percent in late trading, and Hong Kong's Hang Seng index closed down more than eight percent. In Australia, the selloff was less brutal, and the ASX fell by 2.7 percent. But the Australian government has come under more pressure over its guarantee on bank deposits, which Prime Minister Kevin Rudd and Treasurer Wayne Swan announced earlier this month. The move was intended to soothe worried savers and prevent massive bank withdrawals. Critics say instead, investors rushed to move huge amounts of money out of institutions not covered by the guarantee, such as investment funds, and put it into banks. That, they say, is destabilizing some financial businesses. Australian opposition leader, Malcolm Turnbull, says the program needs to be changed. "Mr. Swan and Mr. Rudd have created a terrible mess here. There is no question about that. And I'm sure if they had their time over again they wish they hadn't made the grand gestures they did on the 12th of October," he said. "But in terms of where we go, how we get out of the mess they've created and move forward, it should be at a level recommended by the Reserve Bank." Some of the selling in Asia was sparked by poor earnings outlooks for giant regional corporations. In South Korea, Samsung Electronics reported third-quarter earnings shrank 44 percent, and forecast tough times ahead. And Japan's Sony sharply cut its profit forecast for the year. Both electronics exporters saw their share prices fall about 14 percent Friday.