Japan’s biggest bank, Mitsubishi UFJ Financial Group, fell as Japan’s Nikkei average struck a four-month closing low. It also came under pressure from weak exporters after the US dollar hit a fresh 14-year low against the yen. The Australian and New Zealand dollars retreated.
Oil extended Thursday’s decline to tumble below US$75 a barrel. Shanghai copper and Chicago grains each dropped about 2 percent.
Shares in HSBC Holdings, one of the bookrunners on an outstanding US$5.5 billion Dubai World loan, dropped more than 7 percent and Standard Chartered losses topped 6 percent. The London-listed shares of the two lenders led the biggest tumble in European bank stocks in six months on Thursday.
The Dubai crisis could have a “meaningful impact” on banks across Asia, said Daniel Tabbush, Asia banks analyst at CLSA in Bangkok, listing Standard Chartered, HSBC and Singapore’s DBS Group as the most exposed in the region.
DBS shares were not traded because of a market holiday in Singapore.
China State Construction International ICICI Bank was among Asian banks that said they had no exposure to Dubai after their shares fell.
Builders, such as Australian construction firm Leighton Holdings, took a beating on concern that money due from Dubai’s grandiose construction projects, including the world’s tallest building, would not be paid.
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