Asian trade: Following the negative close on Wall Street, Asian markets also opened lower. The main reason of concern was that Japan’s exports continue to fall at a record pace.
In February, Japan’s exports have fallen by a record 49.4% from one year ago. This was the biggest decline since the early 1980’s, when export data became available. Shipments of Japan’s two biggest industries, cars and technology also tumbled at a record speed. Car exports fell by 70.9% from a year ago, while semiconductors shipments dropped by 51.1%.
Particularly, this release paints a bleak picture for the entire Asian region. The big drop in international trading has devastating effects for most Asian economies, since they are fine-tuned for their export market. The Japanese economy is expected to contract close to 5% in 2009.
In the U.S., a number of states have big problems with the aftermath of the credit crisis. Some states ran big deficits over a long period, but now these debts are starting to bite back. California came near bankruptcy a few weeks back, and now the New York Governor threatens to fire almost 9000 workers unless the union renounces a wage increase and additional benefits agreement. This decision came as the Governor struggled to cut back on spending, since the state of New York runs a $16.2 billion deficit.
Tonight, the Nikkei fell 66.34 points (0.78%) to 8,421.96. The Australian S&P/Asx added 25.20 points (0.70%) to 3,605.20.
Crude oil moved somewhere lower in the Asian session. Crude oil for April delivery fell $0.50 to $53.50.
Gold rose, helped by the negative equity markets. Bullion for immediate delivery gained $4.50 to $930.50.