Sun, Dec 11, 2011 - Page 10 News List

Asia stocks drop as Europe drags down on confidence

Agencies, with Staff Writer

Asian stocks fell this week as Standard & Poor’s said it may strip Germany and France of their “AAA” credit ratings and an EU summit ended without a “unanimous agreement” on fighting the debt crisis.

The MSCI Asia Pacific Index dropped 2.2 percent this week to 115.07. The gauge gained the most in four years the previous week as the US Federal Reserve and five other central banks fought Europe’s crisis by making it cheaper for banks to borrow in US dollars.

“European issues will not be easy,” said Koji Toda, chief fund manager at Resona Bank Ltd in Tokyo. “The global economy is slowing. If you see that fact, you can’t be so optimistic. Companies depending on China business will likely have an impact from the slowdown.”

Taiwan’s TAIEX fell 3.5 percent on the week to close at 6,893.30.

“The [Taiwanese] government’s constant support of the local bourse is unlikely to reverse the current downtrend amid worries over the sluggish economic fundamentals,” Mirae Asset Management analyst Arch Shih (施博元) said.

Hong Kong’s Hang Seng Index declined 2.4 percent this week, while China’s Shanghai Composite Index fell 1.9 percent. South Korea’s KOSPI dropped 2.1 percent.

The Nikkei 225 Stock Average slipped 1.2 percent as reports from Japan last week showed orders for machinery fell unexpectedly and the economy grew last quarter less than initially estimated.

Australia’s S&P/ASX 200 dropped 2 percent as energy and mining stocks slid amid falling oil and metal prices. The nation’s central bank lowered its benchmark interest rate on Tuesday for a second straight month as Europe’s fiscal crisis threatens to slow the nation’s commodity exports.

In other markets on Friday:

Manila closed 0.47 percent, or 20.39 points, down from Thursday at 4,292.50.

Wellington closed flat, nudging up 1.52 points from Thursday to 3,271.46.

Mumbai slid 287.25 points, or 1.74 percent, from Thursday at 16,200.99.

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