The markets across the Asia-Pacific region are plunging sharply today on renewed concerns over widening losses in the financial sector. As stock prices went crashing down on Wall Street after Bank of America marked up protection for bad loans, the mood across the globe has turned quite bearish. The sharp decline in crude oil prices and a stronger yen have also contributed to the weakness.
The markets in New Zealand, Australia, Japan and Korea are trading down in negative territory with sharp losses. The Hong Kong market has also opened on a dismal note. Bank, auto, technology and energy stocks are among the worst hit in the sell-off.
The Nikkei index of Japan is down nearly 300 points or 3.35% at 8,625. The Hang Seng is slumping 552 points or 3.5% to 15,198.
The Korean benchmark KOSPI is down 24 points at 1,312. The S&P/ASX200 index of the Australian stock market is down 95 points at 3,674. New Zealand's NZX 50 is down 40 points at 2,658.
In the Korean markets, bank stocks Korea Exchange Bank, Woori Finance and Shinhan Group are trading sharply lower. Steel makers Posco and Hyundai Steel, auto majors Kia Motor and Hyundai Motor and tech stock Hynix Semiconductor are down with sharp losses. Oil majors S. Oil and SK Holdings and energy stock Kepco are also down with significant losses.
Among, Australian stocks Commonwealth Bank of Australia, ANZ Bank, National Australian Bank, Westpac Banking Corporation and Macquarie Group are down sharply in the red. Materials stocks BHP Billiton and Rio Tinto and energy stock Woodside Petroleum are also trading sharply lower today.
Mitsubishi UFJ, Mizuho Financial Group and Sumitomo Mitsui are among the prominent losers in the Japanese stock market. Auto majors Honda and Toyota are also down sharply.
In currency trading, the New Zealand dollar is trading at 0.5540 to the U.S. dollar. The Australian currency is trading near 0.7010 to the U.S. dollar. The Yen is at 98.13 against the dollar.
Crude oil prices plunged nearly 9% in New York Mercantile exchange amid further concerns over energy demands. Light sweet crude for May delivery dropped $4.45 to $45.88 per barrel, posting its lowest close in five weeks and falling below a trading range that lasted nearly a month.
Most of the Asian markets had rebounded yesterday after exhibiting weakness early on. While the initial sell-off that was witnessed in the previous trading session was due largely to profit taking, selling today is happening more on concerns over mounting bad loans of in the financial sector.
Bank of America surprised the market with better-than-expected results for the January - March 2009 quarter but a higher provisioning for bad loans hurt sentiment to a marked extent.
In a significant development, Oracle announced it would acquire Sun Microsystems for $9.50 per share, a premium of over 40% to the latter's closing price last week. The announcement triggered some hectic buying at the Sun Microsystems counter.
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